Russian Government to Spend $8 Billion Subsidizing Local Car Industry

TTAC Staff
by TTAC Staff

The Russian government said that it will spend up to 271 billion rubles ($8US billion) over the next three years to subsidize the country’s struggling auto industry. A government web site said that the subsidies will underwrite research & development, jobs and costs related to more stringent emissions standards. Car sales in Russia in 2013 fell by 6% to 2.78 million units and 2014 looks like another weak year as the Russian economy stutters, according to the Association of European Businesses.

A 2012 effort to prop up Russian automakers, a recycling fee for imported cars supposedly to pay for scrapping the cars at the end of their life cycles, raised issues with the World Trade Organization so that fee was expanded to include locally manufactured cars as well. The new indirect subsidies are less likely to run afoul of the WTO.

A government incentive program for car consumers was also tried last year but the program ended in December.


TTAC Staff
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  • Cargogh Cargogh on Jan 22, 2014

    I've seen those dashcam videos. The general public looks to be doing a great job of trying to promote industry growth.

    • Onus Onus on Jan 22, 2014

      Yeah what you see is pretty much how people drive. I wish i was joking.

  • JD321 JD321 on Jan 22, 2014

    And in other news...Fiat is going to suck $8B out of Chrysler to subsidize Fiat.

  • Jacob Jacob on Jan 23, 2014

    I feel sorry for the Russian consumers. In the end, because of the government efforts to prop up the perpetually ill national industry, the consumers end up paying far higher prices for car than they would have otherwise. It's like Brazil 2.1.

  • -Nate -Nate on Jan 23, 2014

    Neat little cars IMO . -Nate

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