MOSCOW. (RIA Novosti economic commentator Oleg Mityayev)
In November 2008, global auto markets posted negative results, following the trend of the previous month.
For instance, sales in the U.S., the world's largest auto market, plunged 31%. Germany, the leading European auto market, posted an 18% sales slump, while the Japanese market hit an all-time low of 28%.
Although Russian-market statistics are still unavailable, analysts say the domestic auto market plunged by 10-12% this November. Nevertheless, Russian auto distributors intend to raise prices next year despite the ongoing crisis.
This November, the three U.S. automotive giants, Ford Motor, General Motors and Chrysler, pleaded with the Congress for financial bailout and requested a total of $34 billion by early December. The companies, which have not yet received the bailout package, are already selling off assets.
The Russian auto market also faces negative trends. This November, car sales dropped by 200,000 over November 2007, a 10-12% decline, the Avtostat analytical agency said. November sales volumes fell by the same margin from October this year.
In December, the national auto industry will also find itself in the red. Reduced demand and overstocking are forcing local assembly plants to cut production.
The Russian-U.S. joint venture GM-AvtoVAZ in Togliatti in Russia's Volga Federal District will suspend production starting December 15.
The Moscow-based Avtoframos plant manufacturing the low-budget Renault Logan sedans will also temporarily stop its assembly line that same day.
Production of Ford Focus and KIA Spectra vehicles is falling behind schedule in the Leningrad Region, northern Russia, and in Izhevsk in the Western Urals.
Owing to low demand, GAZ group, the second-largest Russian carmaker, was forced to curtail production of Volga Siber built on the Chrysler Sebring platform.
Russia's largest automaker Avto-VAZ assembling the popular Lada cars will also scale back production in December.
Due to the consumer boom that ended with the summer season, the national auto market will grow appreciably in 2008. Analysts say Russia will assemble 600,000 foreign cars this year, a 36% increase over 2007 (440,000 vehicles).
Avto-VAZ statistics highlight expanded production as well. In January-November, the company assembled 742,800 cars, or 10.3% more, compared with the same period in 2007, when 736,000 vehicles were manufactured.
Due to overstocking, some car dealers will offer 15-20% discounts in the next two months. However, foreign carmakers operating in Russia are bound to raise prices in the long-term because the dollar and the euro will rebound against the ruble and because the government plans to raise car-import duties.
The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.
