Russia Tanks
We are an equal opportunity auto news provider. Don’t like the news that China’s sales exploded by 55 percent in May? No problem! Go to Russia! In May, Russian car sales tanked by nearly 60 percent, Automobilwoche [sub] reports. The former great hope for car growth and member of the BRIC (Brazil, Russia, India, China) states turns into a basket case. It’s down to BIC now to re-ignite growth. Ooops, Brazil’s first-quarter GDP shrank 1.8 percent, so let’s make that a bIC. Back to Russia’s implosion: Who’s to blame?
The Russian government, of course. The Russian government hasn’t done enough to lure buyers into showrooms, grouched Martin Jahn, VP of the Association of European Businesses in the Russian Federation. He demanded increased interest in these matters on the part of the Russian government, and lower interest for car buyers.
Russia wanted to become Europe’s largest car market this year. Scratch that. Since August last year, 3.2 million Russians lost their jobs. In the first five months of this year, the Russian new car market dropped nearly 50 percent.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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I blame George W. Bush.
Where'd you get the picture of a Moskvich in front of a house in Detroit? OK that was bad humor. I admit it. Besides, the house in Detroit would be stripped clean of anything which could be sold at a scrap dealer.
Darn, I thought this was going to be about the T-34. Watch the tricky headlines, please. Steve Lang--well done.
@Mr. Schmitt Don't count Brazil out just yet. Yes, this has been the second semester the economy has shrunk, so we are now officially in a recession. But the numbers for the last months have been improving and everything seems to show that there will be a rebound in the present semester. So yeah, apparently we are already out of the woods. As to cars, the present year has seen an increase in the domestic market. Every month this year has been better than every month last year. So this will be a record year (as a side note, some day in May established a new historic most sales in one day record). Most car companies are running at full capacity and some, like Fiat, cannot produce fast enough to keep up with sales (inventory is almost none existant for some models). But, here there is a trouble spot. Make that a huge trouble stain. In june the tax break for new car purchases will end. I expect sales to plummet by 20% the first month after that, slowly stabilizing to current levels by the end of the year. Which will probably mean that last year will still be the year with the most domestic sales. However, I'm guessing sales will be off by just 5%. If this scenario is accurate, 2009 will still be the second best year in sales ever.