MOSCOW– President Vladimir Putin urged the Russian federal government on Wednesday to control auto rates, as one sector head claimed Western assents could send out yearly sales collapsing to listed below 1 million for the first time because documents began.

Vehicle sales have tipped over 60% so far this year, as well as might end up being less than a quarter of what they were a years earlier, according to Maxim Sokolov, head of Russia’s leading carmaker Avtovaz.

Some of this year’s decline is due to the pullout of international carmakers such as Renault and also Mercedes-Benz as well as a collapse in demand due to a mass mobilization for the Ukraine dispute.

Much is likewise due to falling living standards and also higher prices, as well as the trouble of safeguarding foreign-made elements after the imposition of a barrage of assents by Western nations in reaction to Russia’s armed forces campaign in Ukraine; the most recent Lada model has actually had to be generated without air bags or anti-lock brakes.

Speaking with top officials, Putin acknowledged that the situation was “challenging,” and also asked the government to check out making vehicles extra budget-friendly, recommending that rates were being raised unfairly.

“I want to draw your attention to the need for consistent control over rates, to ensure that under these problems, of which we are all mindful, consisting of logistics, nobody misuses or unreasonably increases the costs of road lorries,” he said.

“I hope that both you and the Federal Antimonopoly Service are doing this regularly.”

‘The most difficult situation’

Trade Minister Denis Manturov informed Putin that assembly lines were being increase at Russia’s residential carmakers– including Avtovaz, manufacturer of the Lada and also a Renault subsidiary until May, GAZ, Kamaz as well as UAZ.

Painting a rosy image, he stated production of the Moskvich (“Muscovite”), a Soviet-era brand that came under obscurity after the autumn of the Soviet Union – would certainly resume by the end of the month, in a plant taken over from Renault.

He also kept in mind, nevertheless, that the marketplace had actually been supported by lendings and also aids for makers, and also said 55,000 automobiles had been marketed with government assistance this year.

Manturov also suggested extending special vehicle funding to army personnel, adding: “Today we can mention an arising trend in the direction of a healing of the industry.”

Sokolov was noticeably much less confident.

He claimed the number of automobiles marketed in Russia would this year loss below 1 million, a first in modern background.

“Last year it was a little over 1.6 (million); God eager, this year it will be 670,000-700,000,” he stated at the annual Transport Week meeting.

This compares to sales of around 3 million devices a year as lately as 2012 – before a dive generated partially by a previous wave of assents in 2014, after Russia unilaterally annexed Crimea from Ukraine.

“Indeed, Avtovaz, along with the entire automobile sector of the Russian Federation, has actually possibly discovered itself in one of the most tight spot this year,” Sokolov stated.

“We have never prior to dealt with such a large-scale and also thorough challenge.”

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