18:42 GMT +321 September 2019
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    At the Volkswagen Rus Group plant in Kaluga, where full-cycle production of cars was launched in 2009

    Putin’s Decree Breathes New Life Into Russia’s Auto Market – German Media

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    President Putin’s decision to offer generous tax breaks to foreign automakers, which build at least 300,000 vehicles a year in Russia, has helped keep the domestic car market afloat and encouraged foreign carmakers to invest in Russia.

    “Although not slated to take effect until next year, the presidential Decree N166 encouraged the European carmakers to invest more into their production facilities in Russia even before the outbreak of the crisis in Ukraine,” Die Welt wrote on Thursday.

    “This decree is one of Putin’s biggest economic coups to date. Ten years ago only a fraction of cars sold in Russia were actually built in Russia, while now we have most of them manufactured inside the country,” the newspaper added.

    Die Welt also attributed the upswing to the weak ruble playing into the hands of both carmakers and spare part suppliers.

    Even though falling demand has prompted many automakers to cut down on production, Volkswagen’s Japanese supplier of spare parts is now expanding its production facilities in Central Russia.

    Moreover, the German automaker has just opened a new engine factory in Kaluga, Die Welt wrote.

    Related:

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    Tags:
    auto market, presidential decree, growth, Volkswagen, Vladimir Putin, Russia
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