The Russian automotive industry development strategy for the period until 2020 was approved by the government and endorsed by the Ministry of Industry and Trade on April 23, 2010. The strategy aims to overcome the effects of the economic downturn and ensure the industry's sustainable development in the post-crisis period.
The strategy's goal is to maximize the value added across all stages of auto production in Russia and to increase the share of Russian-made equipment in the market.
The following stages have been set to achieve these objectives:
Stage I (2010): overcoming the effects of the economic downturn;
Stage II (2011-2014): post-crisis recovery of the industry and creation of a basis for innovative development;
Stage III (2015-2020): competitive auto industry development in a stable market environment
To this end, the following measures have been implemented in 2010:
1. The subsidised loan programme, launched in 2009 to provide consumers with low-interest credit on the purchase of Russian-made cars worth up to 600,000 roubles, has been extended. As of December 16, 2010, 155,000 loans have been issued (336,500 loan applications have been submitted). By year's end, the loan subsidies are expected to reach 610 million roubles.
2. A programme offering consumers a 50,000 rouble discount when they trade in old vehicles for new Russian-made cars is currently under way. A total of 11.6 billion roubles will be provided to fund the programme in 2011.
3. The federal executive bodies have received an additional 20 billion roubles towards the purchase of Russian-made vehicles.
4. Ten billion roubles have been allocated to Russian regions towards the purchase of motor vehicles and road-building equipment, with regional authorities covering at least 40% of the equipment's cost.
5. The government has been subsidising the rail shipment of Russian-made vehicles to the Far Eastern Federal District.
6. The government has been subsidising the rail shipment of vehicles assembled in the Far Eastern Federal District to other parts of the country.
The measures taken to support the automotive industry in 2010 have achieved the following results (as compared with the results of the first 11 months of 2009):
Production of motor vehicles of all types (including foreign brands) has increased by 91.8%, from 655,300 units to 1,256,700 units.
Car production rose by 98.5%, from 545,400 units to 1,082,400 units. The largest manufacturers are AvtoVaz, Avto-Holding, Volkswagen-Rus, and Avtoframos.
Production of trucks increased by 73.1%, from 36,500 units to 63,300 units. The largest producers are KAMAZ, GAZ, and URAL.
Bus production increased by 30.3% from 9,400 units to 12,200 units. The largest produces are PAZ and LiAZ.
Production of light trucks rose by 54.5%, from 64,000 units to 98,800 units. The largest producers are GAZ, UAZ, and Sollers-Yelabuga.
Changing market conditions
With 1,793,500 vehicles sold annually, Russia is Europe's fifth largest car market after Germany, France, the UK, and Italy.
A total of 1,573,000 cars, 75,700 trucks, 11,500 buses, and 133,300 light trucks were sold in the first 11 months of the year.
The share of Russian-made cars in total sales has increased from 50.3% in 2009 to 67.9% in 2010.
Lada (AvtoVaz) remains the most popular brand on the market, with four of its models topping the sales charts. The fifth most sold car (30,100 vehicles) is the Renault Logan (Avtoframos), followed by the Ford Focus (34,500 cars).
The market share of Russian-made trucks has dropped from 89.7% in 2009 to 79.5% in 2010.
The market share of Russian-made buses has fallen from 96.5% in 2009 to 92.8% in 2010.
The market share of Russian-made light trucks has dropped from 73% in 2009 to 72.4% in 2010.
Measures planned for 2011
The following measures have been included in the budget to support the Russian automotive industry in 2011:
1. Provision of subsidies (a total of 6.1 billion roubles) to Russian auto manufacturers, including their subsidiaries, to partially reimburse them for the interest payments on investment project loans and (or) the coupon yield payments on bonds issued to finance investment projects.
2. Extension of the programme to provide a 50,000 rouble discount to consumers replacing their vehicles with new Russian-made cars. A total of 13.45 billion roubles will be allocated to fund the programme.
3. Extension of the subsidised car loan programme. A total of 2.8 billion roubles will be allocated to subsidise consumer car loans issued between 2009 and 2011.
4. Provision of subsidies for the rail shipment of Russian-made cars to and from the Far Eastern Federal District. These subsidies will total 1 billion roubles.