Conflict Impacts July New-Vehicle Sales in Russia

With the sanctions battle between Russia and the West escalating, July new-vehicle sales plunged 22.9%, or 53,598 units, to 180,767.

The Association of European Businesses’ Automobile Manufacturers Committee says the latest result left the year-to-date total down 9.9% to 1,410,606 vehicles.

“The contraction of the automotive market continues, picking up speed in July,” committee Chairman Joerg Schreiber says in a statement. “The overall trend is worrisome and unlikely to improve fundamentally any time soon.”

Schreiber says the Moscow auto show set to open at the end of the month should spur new-car demand, especially in the usually stronger autumn season.

“In any case, this is how it normally works,” Schreiber says. “But what has been normal this year so far?”

In a separate statement, the AEB says it regrets the escalation of tensions between the European Union and Russia amid the most recent tit-for-tat sanctions imposed by Russian authorities against agricultural products.

“The AEB strongly requests (the) EU and Russian authorities to protect foreign investors from both sides from any further retaliatory measures,” the statement says.

The AEB, representing more than 600 companies from the EU and the European Free Trade Area, says it believes any limitations on business activity will hurt long-term EU-Russian relations.

Meantime, Lada continues to lead the shrinking market with July deliveries down 25% to 28,014 units for a 7-month total off 16% to 220,822.

Kia follows, falling 15% to 15,303 units in July and 2% through the first seven months to 109,276. Renault, down 16% to 15,219 deliveries placed third for the month, but remains No.2 for the year, down 9% to 111,640.

With everything American the focus of Cold War-like Russian-government tactics, Chevrolet sales plunged 45% to 8,457 units and now are down 23% for the year to 73,749.

Ford suffered a similar fate, falling 52% for the month to 4,500 units and 41% year-to-date to 35,818.

The AvtoVaz-Renault-Nissan alliance saw deliveries drop 22.2% in July to 52,743 units and 8.3% for the year (220,822).

Volkswagen Group sales slid 20.3% for the month (19,729 units) and 10.5% in January-July (154,606).

The Lada Granta remained the best-selling model in the month and for the year, with July deliveries off 18.7% to 11,819 units and the 7-month tally down 15.7% to 83,294.