Minister: Russian car industry may stabilize soon, needs help

BEIJING, Jun 27 (PRIME) -- The Russian car industry may stop declining very soon, but it needs state support, including export support, for consistent development, Economic Development Minister Alexei Ulyukayev told reporters on June 25.

“Statistically speaking, it will happen very soon, it was just the basis effect due to a very significant contraction in 2015. The fall continued at the beginning of 2016, but it was much more moderate, so I think that it will statistically disappear from 2017, but it will disappear at a low sales level of no more than 1.5 million cars per year, which is not good,” he said.

There is still hope for pent-up demand and that the current high rate of savings will turn into additional demand in 2015, but the government should not wait for that and support exports of Russian carmakers.

“We should do that, we obviously need state support for that, we should reorient it and not simply support car industry companies, but support their export capabilities, as it is very important to cut transportation costs,” Ulyukayev said.

This year, the government earmarked 138 billion rubles for support of the car industry, which is three times higher than the spending in 2015.

(65.5287 rubles – U.S. $1)

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