MOSCOW (Reuters) – Russia’s second-hand car market expanded last year as new car sales fell by more than half as the auto industry was hit hard by Western sanctions over the war in Ukraine. The number of automobiles produced has plummeted, new car prices have skyrocketed, and buyers are turning to cheap used cars.
Analysts continue to debate the effectiveness of the sanctions against Russia, but there seems to be no doubt that the Russian auto industry, which relies on foreign manufacturers and imported parts, has been hit hard.
Total new car purchases last year fell by 52% to 1.5 trillion rubles ($20.4 billion), while new car sales fell by 58.8%. As Western automakers halted production in Russia and sold factories, car production fell to its lowest level since the collapse of the Soviet Union in 1991.
Inflation-driven price hikes and lower living standards have led to a more than 15% decline in total new and used car purchases in 2022, but used cars will rise by 14% in 2022, according to data from research firm Autostat. As a result, the ratio of used cars in all car sales has increased to about 75% from 55% in 2021.
“The money was pouring into the used-car market and used-car prices held up. “Lada and Chinese cars, which are cheap at around 2 million rubles, have remained in the new car market, but premium brands have almost completely disappeared,” he said.
