Car production will increase by 7% in 2017, according to the prediction of the Russian Ministry of Industry and Commerce

Car production will increase by 7% in 2017, according to the prediction of the Russian Ministry of Industry and Commerce

Vedomosti – The government will stimulate demand through a series of programmes, such as: car fleet utilisation, preferential leasing and car loans, procurement of equipment amongst others. A total amount of almost 60 billion rubles has been allocated for government support programmes this year.

The Ministry of Industry and Commerce has proposed the replacement of the largest programme -car fleet utilisation- with a number of narrowly focused schemes – “First automobile”, “Russian tractor”, “Rural vehicle” etc. However, the final setting of the stimulation measures and their conditions has not been decided yet and the discussions continue, as told by officials from four automakers. Quite possibly, the fleet utilisation programme or its principles (a discount in exchange for handing the old car for utilisation or through the trade-in scheme) will continue one way or the other, said one of the officials. The total amount of government support has not been confirmed. The figure is being discussed on the levels of the current year, however, a lower figure may come up in the end, two of the officials are concerned. “No assignments have been made on the draft budget law yet (2017-2019), however, as I said before, we have stock and there are remains from 2016. As confirmed in recent meetings, funds should be allocated for these purposes” – said the Deputy Prime Minister Arkady Dvorkovich yesterday.

As previously predicted by PwC, car production may increase by 15% in 2017 and sales by 17%. Autostat has also predicted a resumption of growth in the market in 2017. Car production may increase by 6-8% in 2017, taking into account the predicted 5-6% market growth, said the representative of VTB Kapital.