The Ministry of Industry and Commerce expects 8% growth in Russian automobile industry in 2017

Kommersant – The Ministry of Industry and Commerce expects 8.4% rise in Russian car production in 2017, to 1.4 million units. The production will increase relatively evenly amongst the segments, each by around 8.4%, according to the calculations of the ministry. Thus, car production should increase to 1.2 million units, trucks – to 64,900, light commercial vehicles (LCV) – to 122,200. The rise expected in bus production is a little bit more, by 8.7% to 13,800 units.

Car production has shrunk by 8.1% in 2016, to 1.106 million units, according to ministry data. Production of vehicles of all kinds was down by 5.5%, to 1.29 million units.

The total market (taking imports into account) of passenger cars and LCV will grow by 7.4% this year – to 1.53 million units, according to the Ministry of Industry and Commerce. The Association of European Businesses (makes a total forecast for the passenger segment and LCV) is slightly more cautious in its predictions: 1.48 million units. The Association assumes that the the government support on automotive industry will be at planned levels and the new programmes will be effective. In addition, cautious signals concerning the improvement of the external factors (oil prices, GDP trends) are taken into the account in the predictions.

PwC agrees with the expectations of the Ministry of Industry and Commerce, the only relative contradiction being in the LCV segment: the ministry predicting 118,700 units, PwC only 97,000. Analysts believe that PwC has a more pessimistic approach towards the impact of government support. The market leader GAZ Group is also of the same opinion with PwC: the head of the company Vadim Sorokin had announced his expectation of growth in LCV market as 2-5% for this year in mid-March, to 98,000 units at the most. “I don’t expect a significant improvement in Russia” – the senior manager explained his forecast.