Yesterday, 19:47 | author: Marat Kudeev | Photo en.depositphotos.com
Bankauto marketplace expert Sergey Vlasov told Sterlegrad.ru which brands will remain with us in 2022.
Asian automakers monopolize the Russian market
This year we are definitely waiting for the transformation of the Russian car market. The list of already understandable results includes the continued shortage of cars on the market, rising prices and a change in the balance of power among manufacturers. If the position of international automakers, announcing their withdrawal from the Russian market amid sanctions pressure, does not change, by the middle of the year, half of the market may be occupied by Korean and Chinese manufacturers.
Russian motorists should get ready to narrow the range. The exchange rate of the ruble once morest the dollar and the euro and the stability of import supplies (both cars themselves and components for assembly) are two main factors that have a significant impact on the Russian automotive market. After the start of the military operation in Ukraine, the exchange rate of the ruble fell significantly, and a number of international automakers supported the sanctions by refusing to supply cars and components, stopping conveyors at factories in Russia. Against this background, last year’s trends intensified – the shortage of cars on the market and the jump in prices.
Production and supply chains have broken
Many car brands have not yet announced their final withdrawal from the Russian market, but have suspended production. Among them are Volkswagen Group Rus (plants in the Kaluga region and Nizhny Novgorod), Mercedes-Benz (Moscow region), BMW (Kaliningrad), Toyota, Nissan (St. Petersburg) and Sollers Ford (Elabuga). Against this background, however, the French automaker Renault distinguished itself, which officially announced that it was suspending its activities in Russia and deciding what to do with the plant in Togliatti.
Less than half of the passenger and light commercial vehicle production capacities that were in operation in 2021 are now operating in Russia. These are the PSMA Rus plants of the Stellantis and Mitsubishi alliance, in Kaliningrad Avtotor (for assembling Kia and Hyundai), Haval, the GAZ group, AvtoVAZ in Tolyatti, UAZ, Mazda Sollers and Isuzu.
In turn, among the importers who have suspended the import of cars are Audi, Porsche, General Motors (Chevrolet and Cadillac), Jaguar Land Rover, Lexus, Volvo, etc.
Premium breaks
Moreover, once morest the backdrop of another package to ban the import of cars worth more than 50 thousand euros from the EU, the USA and the UK into Russia, Russian wealthy car owners will have to do without many premium cars.
Russian buyers will lose the Audi A6, A7 and A8, Q7 and Q8 crossovers, as well as all S and RS models. BMW in Russia will ban X5, X6, X7 crossovers, sedans from the 5 Series and all M-modifications. Of the Jaguar Land Rover lineup, only Jaguar E-Pace, Range Rover Evoque and Land Rover Discovery Sport can remain in Russia. And Mercedes-Benz will continue to sell some versions of the A- and B-Class compact cars, the CLA four-door coupe and the C-Class sedan. The range of Volvo in Russia may be reduced to three models: S60 sports sedan, XC40 and XC60 crossovers. As for Porsche, Ferrari, Bentley, Lamborghini and Rolls-Royce, taking into account the price tag of these brands, their products will not be seen in Russia either. It is also worth noting that the restrictions may also affect some representatives of the mass market, such as the Volkswagen Touareg, whose price in Germany starts from 66 thousand euros.
All American-made cars, including used ones, also fell under the embargo. We are talking primarily regarding premium Jeep, Cadillac and Chevrolet SUVs, as well as Nissan Pathfinder, Toyota Highlander, Mercedes-Benz GL and some models of the BMW X series and Infiniti produced in the USA. In addition, Tesla electric vehicles were unofficially delivered to our country.
The reshuffling of forces in the market
Nevertheless, the main contenders for replenishing the narrowed assortment in the mass market segment, in addition to the products of AvtoVAZ, which will eventually solve problems with production and start production, are Asian auto concerns.
The products of Korean manufacturers are well known and in demand in Russia. Now they own 25% of the market, this is a clear leadership position that brands are likely to want to keep. That is, if the situation worsens, they will look for opportunities to stay on the Russian market.
Chinese manufacturers have a smaller market share, which allows them to actively increase their presence in Russia. The expansion is proceeding at a high speed – a year ago, in January-February 2021, the top 10 Chinese brands in terms of sales sold 10.7 thousand new cars. This corresponded to a market share of 4.9%. And in the first two months of 2022, the number of cars sold by them increased to 20.2 thousand, and the share – to almost 10%. The best-selling brand is still Haval (6.7 thousand vehicles, 3.3% of the market in January-February 2022). Its sales almost doubled in a year. Chery increased its sales volumes to 5.7 thousand cars, and its share to 2.8%. Even higher growth rates are shown by Geely (4.1 thousand vehicles, 2% of the market) and Exeed (1.8 thousand, 0.9%).
The first increased sales by 2.3 times, the second – by 8.6 times. In addition, once morest the background of the rise in sales of Chinese brands in 2021, other automakers from the Middle Kingdom (Foton, BYD, Saik) may also reach the Russian market. Many have already publicly announced that they are out of sanctions once morest Russia. Under the current conditions, there are all prerequisites for the fact that their previously planned expansion can be faster and more successful.
Companies that have announced a boycott of the Russian market can potentially release regarding 20%. So by the summer-autumn, subject to an increase in supplies, the share of Korean and Chinese companies may reach 50%. The space vacated in the market may also attract new players: for example, automakers from India (Mahindra or TATA).
So, by supporting sanctions once morest Russia, Western manufacturers risk losing their positions to Asian concerns for a long time. And, even returning at one fine moment, they will not be able to restore their positions in the new realities. By that time, consumer habits and preferences are likely to change, and the impoverished lineup of returning Western automakers will no longer be able to compete with a wide range of Korean and Chinese brands.
