MOSCOW, July 22 Russia's car market is expected
to decline by up to 4 percent this year, Russia's deputy
Minister of Trade and Industry said on Monday, as the country's
$2 trillion economy falters.
The forecast is slightly less pessimistic than that given by
the Association of European Businesses (AEB), which tracks the
Russian car market and recently released data showing that car
sales have fallen for four straight months.
The AEB last month cut its full-year forecast to 2.8 million
vehicles - a fall of nearly 5 percent on last year - but said it
expects government plans to subsidise credit-backed vehicle
purchases to boost sales for the remainder of the year.
"We will see a fall of 2, maybe 4, percent (in overall 2013
sales)," deputy minister Alexei Rakhmanov said, adding that the
state programme of interest subsidies on car loans should
support the market.
Western carmakers including General Motors, Ford
, Renault and Fiat have invested heavily
in Russia, betting that Europe's second-biggest car market will
grow with the country's rising middle class.
The market, however, has stalled as the economy slows, with
consumers less willing to make large purchases. Russia's economy
expanded by 1.6 percent in the first quarter - it's slowest
growth since 2009.
A report last week from Boston Consulting Group made light
of the current economic weakness, saying that the Russian car
market is on track to overtake Germany as Europe's biggest by
2020 as car ownership increases, supporting a large local