Surge in Used Car Sales: Russians Buy 546,200 Vehicles in July 2023
In July 2023, Russians purchased an impressive 546,200 used cars, marking the highest figure in nearly a year, according to the analytical agency Autostat. The previous month, August 2023, saw a slight increase with 551,300 used cars sold, indicating a robust demand in the secondary market. The popularity of used vehicles is largely driven by declining prices, which have seen a consistent drop for five consecutive months, making them increasingly attractive to potential buyers.
Lada remains the top-selling brand in Russia, with 133,000 units sold in July. Other leading brands include Toyota, Kia, Hyundai, and Nissan, with sales figures of 56,000, 32,500, 30,900, and 25,800 units respectively. The average price for a used car in the secondary market has also decreased, now standing at approximately 1.5 million rubles, reflecting a 3% drop from the previous month. This price reduction is attributed to a previous surge in costs that discouraged immediate purchases, leading to a pent-up demand that is now benefiting sales growth.
The Impact of Chinese Automakers and Future Projections
The Russian automotive market is witnessing a significant shift, particularly with the increasing presence of Chinese automakers, whose market share has surged from 9% in early 2022 to 61% by July 2024. This change is primarily due to the exit of Western brands following sanctions and the subsequent filling of market gaps by Chinese companies. In July alone, over 136,000 new cars were sold, representing a 42% increase compared to the same month last year, with LADA accounting for more than a quarter of these sales.
Looking ahead, experts predict that the Russian car market could return to pre-crisis levels by the end of 2024, with forecasts estimating sales of new cars to range between 1.2 million and 1.75 million units, depending on market conditions. The anticipated increase in recycling fees by 70-85% in October may further motivate consumers to make purchases before costs rise. Overall, the secondary market has shown positive growth, with a 0.9% increase in sales during the first seven months of 2023.
- The ongoing decline in used car prices is a crucial factor driving sales. As consumers become more price-sensitive, the affordability of used cars is likely to sustain demand. Additionally, the increasing acceptance of new vehicles, particularly from Chinese brands, suggests a diversification of consumer preferences in the Russian automotive market. Experts remain optimistic about the overall market trajectory, emphasizing the importance of monitoring external factors such as economic conditions and government regulations that may impact future sales.
