Dealers expect new car prices to rise by 10% in early 2023

The shortage of new cars due to the cessation of deliveries of European, American and Japanese brands to the Russian Federation this year caused an increase in car prices. Commodity stocks for departed brands will be sold out by the end of the 1st quarter of 2023, and the cost of new cars will increase by 10%, market participants told the TASS agency. "Prices for cars will grow; there are no prerequisites for their reduction. It feels like they will be about 10% higher than current levels. The cost of cars will depend on exchange rates and logistics supply chains. The more restrictions appear, the higher the costs of suppliers and the final cost of cars, respectively," said Andrey Olkhovsky, General Director of Avtodom Group of Companies. Speaking about prices for Chinese cars, he predicted that there is no need to expect a decline either, companies from the PRC "will continue to increase volumes and earn profits.

" According to Aleksey Podshchekoldin, Chairman of the Board of Directors of BN-Motors, in the context of a shortage, which, due to the departure of most automakers, is about 1 million cars, the average cost of a car by the end of 2022 will be 2.3 million rubles (plus 20 - 25% to 2021). At the same time, real incomes of the population are declining and, accordingly, consumer demand for cars is declining. Chinese brands, which at the beginning of the year increased the cost of cars about 1.5 times in compare with 2021, are now offering to purchase a car with a discount of up to 600,000 rubles. According to the expert, the next year the cost of Chinese brand cars will remain at the level of November-December of 2022. As for Russian brands (LADA, GAZ, UAZ), they are likely to rise in price by 10-15%, as they still have problems with the logistics of components and the search for new suppliers.

As for cars imported under parallel import, their price will be higher than for similar models previously produced in Russia. There are no prerequisites for falling prices: no changes in terms of import duties and other relaxations are expected. Stabilization of prices in the Russian car market can be expected if the volume of car production in the Russian Federation increases to 1.5 million cars per a year (this is the level of 2021). Plus, an additional volume of parallel imports is about 500 thousand cars. According to Aleksey Podshchekoldin's forecast, the shortage of cars will continue for the next 2-3 years, until the moment "the revival of car production in the Russian Federation."