AutoBeta(AutoBeta.net)02/09 Report--

The territory of Chinese car companies entering the Russian market is constantly expanding. Rolf, Russia's largest car dealer, and Beijing Automotive Factory (BAW) have reached a preliminary agreement to sell the brand's light vehicles in St. Petersburg, the Russian News reported.

In response, Arbi Abu Bakarov, vice chairman of the Foreign Relations Committee of the Russian government of St. Petersburg, said: "an agreement is being drafted and we are interested in achieving supply within a few months." In the future, if there is a good demand for this Chinese brand car, we also plan to establish local production of BAIC in St. Petersburg. " In addition, Lebedeva, vice chairman of the St. Petersburg Chamber of Commerce and Industry, said that another dealer also made a request to sell BAIC passenger cars in St. Petersburg, but its name was not disclosed.

Beijing Automobile Factory, founded in 1958, is the second large-scale automobile manufacturing enterprise built after Changchun first Automobile Factory. In 1987, it merged with Beijing Motorcycle Factory to form Beijing Automobile and Motorcycle Co., Ltd. (abbreviated as Beijing Automobile and Motorcycle Co., Ltd., BAM). In 2001, it was reorganized with Beijing Automobile Assembly Plant, and Beijing Automobile Manufacturing Plant Co., Ltd. (BAIC Co., Ltd., BAW) was established according to the modern enterprise system. According to the official website, at present, Beijing Automobile Factory has four major industrial bases, namely Huanghua Base, Dezhou Base, Qingdao Base and Linyi Base, with an investment of 45 billion yuan and an annual production capacity of 450000 international standardized production lines and equipment. it mainly produces the development, production and sales of light off-road vehicles, trucks and related special-purpose vehicles, and is the designated production enterprise of national military vehicles and the backbone production enterprise of light off-road vehicles and trucks in China. It is listed as one of the four key vehicle manufacturing enterprises in Beijing.

At present, Beijing Automobile Factory (BAW) has reached a preliminary agreement with Russia's largest car dealer.If BAIC can successfully enter the Russian market, it means that the sales of Chinese-branded cars in the Russian market may be further improved.

Data show that Russian car sales totaled 687400 units in 2022, down 41.24% from the same period last year. The sharp decline was mainly due to the conflict between Russia and Ukraine in February 2022. Since then, a series of reasons, such as Western sanctions, supply disruptions and the intensification of the conflict between Russia and Ukraine, have caused a large number of car companies to suspend car exports and sales to Russia. These include Volkswagen, Honda, Ford, BMW, Mercedes-Benz, General Motors, Volvo, Jaguar Land Rover, etc. More seriously, under the influence of the epidemic, geopolitics and other factors, a number of Western car companies choose to "survive without arms" to withdraw from the Russian market.

Before the outbreak of the conflict between Russia and Ukraine, the Russian car market was competed for market share by a number of western automakers, such as French Renault, Mercedes and Ford, and local Russian carmakers. After the full outbreak of the conflict between Russia and Ukraine, the Russian car market has changed the past. According to "Automotive Industry concern" statistics, including French, Japanese, and Korean brands, car companies have withdrawn from the Russian auto market, of which Renault, which accounts for nearly 10% of the Russian auto market, first announced its departure from the Russian market. Toyota, Nissan, Ford and Mazda followed, while Volkswagen, Hyundai and Mercedes-Benz also planned to sell assets in Russia.

Unlike many car companies breaking away from the Russian market, Chinese car brands entered the Russian market on a large scale, and car brands including Harvard, Chery, Geely and other car brands entered the market and quickly filled the gap in the local market. As a result, the market share of Chinese car brands in Russia has soared rapidly. in addition, Chinese car companies' penetration of parts into Russian local car companies is also accelerating.

Although the overall Russian car market was depressed in 2022, the share of Chinese brands in the Russian market increased significantly. According to the data, the cumulative sales of Chinese brands in Russia in 2022 was 123500, of which Chery had the highest sales, with a cumulative sales of 39500 vehicles, ranking fifth in the Russian market, followed by Harvard and Geely. In addition, the market share of Chinese brands increased from 9% in January in 2022 to 37% in December 2022, compared with Korean brands from 28.3% to 11.2%, European brands from 28.3% to 7.3%, Japanese brands from 17.9% to 6.6% and American brands from 1.1% to 0.9%. Bespalov, a Russian auto industry analyst, has previously said: "Western brands produce very little in Russia and export very little to Russia, so the Russian car market is carved up by the Russian and Chinese car industries."

Under the background of the substantial increase in the market share of Chinese car brands, there are also many domestic car companies that want to try to enter the Russian market and share a piece of the cake. In December 2022, Russian executives told local media that car manufacturing plants leaving Russia should be sold to Chinese carmakers. Because many foreign carmakers have left production lines in Russia, selling some of their capacity to Chinese brands will allow them to expand their production capacity locally. At that time, the head of the press office of Autostat, a Russian auto market analyst, also pointed out that Chinese car brands might be interested in withdrawing from Western and Japanese brand car factories in Russia.

At present, the Russian car market is forming "Russian car brands dominate the market of less than 1.5 million rubles (about 167000 yuan) at lower prices, and Chinese car brands dominate the Russian market of more than 2.5 million rubles (about 278000 yuan)". The Russian Ministry of Industry and Trade and relevant departments predict that market sales will gradually pick up this year, while the share of Chinese cars in the Russian market will continue to increase, and it is expected that sales in Russia may reach 300000, accounting for 35% of the Russian car market. 37% of the Russian car market, when the total sales of the Russian car market will reach 800000.

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