Decrease in Fresh Car Purchases Evaluated by S&P Trade Division
The car sales market in Russia has witnessed notable fluctuations in the last few years, influenced by a mix of global and domestic factors. As we approach 2025, predictions for the automotive industry are shaped by economic conditions and interest rates.
In 2023 and 2024, the global car market rebounded beyond pre-pandemic levels, making Eastern Europe—including Russia—one of the fastest-growing regions for auto sales. Although specific Russia-only sales figures are not available, this suggests that Russia’s car market likely saw some recovery during this period.
Russia’s oil consumption, closely tied to transport and thus potentially car usage, rose in 2023, reaching its highest level in recent years. This correlates with increased car activity and indicates a healthy demand in the car sector.
The broader automotive industry outlook through 2025 is optimistic, with forecasts of around 3.15% CAGR globally. This indicates continued growth in vehicle production and sales.
For 2025, global car sales are forecast to keep rising, following the upward trend from 2023 and 2024. While direct sales forecasts for Russia are not explicitly given, the positive regional growth in Eastern Europe and increased oil consumption tied to transport suggest sales are expected to grow or at least stabilise.
The automotive industry's focus on passenger vehicles with advanced technologies to meet efficiency and emission regulatory demands might also enhance vehicle attractiveness and sales volumes by 2025, indirectly benefiting markets like Russia where passenger cars dominate.
The key interest rate plays a moderating role on car sales by influencing financing conditions. Higher key rates generally raise borrowing costs, potentially suppressing car sales by making financing more expensive. Given the reported challenges in neighbouring markets where tighter auto loan conditions contributed to reduced vehicle production and sales, a similar mechanism likely applies in Russia: if the Central Bank of Russia maintained or increased key rates during 2023-2025, it could moderate car sales growth by limiting consumer credit availability or affordability.
In the first six months of 2025, the sales of new passenger cars in Russia decreased by more than 11% compared to the same period in 2024, totaling over 333,000 units. Russian dealers expect a decrease in car sales in 2025, with predictions ranging from 12% to 25%. However, it's important to note that specific data for the sales of domestically produced cars in the first six months of 2025 and for the sales of trucks and buses in various years were not provided.
In conclusion, Russia’s car sales market from 2023 to 2025 has experienced recovery and growth consistent with Eastern European trends, aided by rising transport activity and fuel consumption. Sales in 2025 are expected to continue rising or remain stable, aligned with a broader global automotive growth forecast. The key interest rate plays a moderating role on car sales by influencing financing conditions; rising rates can constrain demand, while lower rates can stimulate it. Specific detailed data on Russian car sales volumes and key rate levels would be required for a more precise assessment, but the overall outlook is cautiously positive with some sensitivity to financing costs.
- The positive regional growth in Eastern Europe and increased oil consumption tied to transport suggest that the finance sector in Russia, particularly the automotive business, may expect growth or at least stabilization in car sales by 2025.
- As the automotive industry focuses on passenger vehicles with advanced technologies to meet efficiency and emission regulatory demands, the appeal and sales volumes of such vehicles in the business sector of Russia, where passenger cars dominate, might increase by 2025, potentially benefiting the overall finance and economic landscape.
