Industry minister sees harder year ahead for Russian automakers

MOSCOW. Dec 25 (Interfax) - Russian production and sales of motor vehicles in all segments is growing significantly this year, but next year will be difficult for the auto industry due to sanctions and the macroeconomic situation, Industry and Trade Minister Anton Alikhanov told reporters, remarking that the forecasts for 2025 factored into the industry strategy are "fairly ambitious considering current conditions."

Sales of cars, light commercial vehicles (LCV), trucks and buses grew by 44% to 1.69 million vehicles in the first 11 months of 2024, the ministry estimated. However, it was reported that there was a month-on-month drop of more than a quarter in November.

The ministry expects production of motor vehicles in all segments to grow by 13% to more than 950,000 for the year, Alikhanov said.

"But next year will be more difficult than this one for both the auto market and automakers. External sanctions pressure continues to increase, the industry needs to adjust to the rapidly changing macroeconomic climate. Towards the end of this year we see signs of a gradual slowdown in the dynamic of demand. The auto financing market is shrinking, consumer activity is declining," Alikhanov said.

He recalled that the current version of the strategy for the auto industry projects sales of 1.58 million motor vehicles, including 1.3 million new cars. Production is supposed to grow to 1.1 million tonnes vehicles in 2025.

"But again, macroeconomic factors and the existence of effective demand will directly affect the achievement of this bar," Alikhanov said.