Putin says government must support domestic car industry By Reuters

LONDON (Reuters) -Russian President Vladimir Putin ordered his authorities on Thursday to give you new measures to assist the home automobile business, which has seen gross sales crater since Moscow launched its invasion of Ukraine.

Amid a crunch on demand from Russian patrons and extreme logistics issues on account of Western sanctions slapped on Moscow, automobile gross sales slumped a file 83.5% in Might, in keeping with figures from the Affiliation of European Companies (AEB).

“I wish to ask the federal government to inform us intimately what swift measures it’s taking to assist the auto business and stabilise the inner market,” Putin stated in a gathering with authorities officers broadcast on state TV.

Putin additionally stated the federal government wanted to look not solely at manufacturing points, but in addition at the way to stimulate demand regardless of the financial difficulties going through the nation.

In keeping with Russian statistic company Rosstat, automobile costs have jumped almost 50% for the reason that begin of the yr, slamming demand in a rustic the place family incomes have declined whereas inflation has been hovering close to 20-year highs.

In latest weeks a string of Russian officers have warned a couple of attainable demand stoop within the financial system that would intensify the financial disaster, already anticipated to be the worst in a minimum of twenty years.

Regardless of a high-profile import substitution drive, Russia’s auto business had remained closely reliant on overseas funding and gear.

Lada-maker Avtovaz, Russia’s largest automobile producer, halted manufacturing for greater than two months citing a scarcity of digital elements.

French auto big Renault (EPA:) struck a deal in Might to promote its majority stake in Avtovaz to a Russian science institute, reportedly for the symbolic sum of only one rouble, with a six-year possibility to purchase it again.