(Reuters) – Sales of new cars in Russia fell 10.6% year on year in March to 48,414 vehicles, the Association of European Businesses (AEB) said on Thursday.
First-quarter sales were down 44.7% as the industry continues to reel from the fallout of Western sanctions imposed on Russia over its military campaign in Ukraine, the AEB said.
The industry has been among those hit most heavily by Western sanctions over the past year.
Sales of new cars collapsed by 59% in 2022 as several major manufacturers halted production for weeks, unable to secure parts as Western supply chains fell apart.
The industry had been heavily reliant on investment from Western car manufacturers, which left the market soon after Russia sent tens of thousands of troops into Ukraine, as well as for equipment and parts.
Production of new cars in Russia slumped to the lowest level since the collapse of the Soviet Union and prices for new vehicles have risen dramatically, sapping demand at a time when Russian consumers remain cautious about spending on big-ticket items.
Russia is now seeking investment and partnerships from what it calls “friendly” countries – those that have not imposed sanctions – and is trying to restart production at plants owned previously by Western carmarkers.
The AEB previously forecast that sales would rise by 12% in 2023 to about 770,000 vehicles, well below the more than 1.6 million new vehicles sold in 2021.
