Russian car sales plunge 83.5% in May, another historic dive

Car sales in Russia plunged 83.5% in May to another historic low, the Association of European Businesses (AEB) said on Monday, as Western sanctions have decimated Russia’s car industry with parts shortages and spiralling prices.

Russia sent troops to Ukraine on February 24, and sales of new cars have been falling since March as sanctions blocked main supply chains. Last month, only 24,268 vehicles were sold, AEB said. A year earlier, sales were six times greater.

Top western carmakers led by Renault have either suspended operations or left Russia since sanctions took effect. The country’s car industry depends on global supplies, and the shortage of parts has shrunk production volumes several times since February 24.

According to Russian statistic agency Rosstat, car prices have jumped nearly 50% since the start of the year, slamming demand in a country where household incomes have declined while inflation has been hovering near 20-year highs.

AEB did not provide a forecast for the Russian auto market performance this year. In April, it forecast new car sales in Russia to fall by at least 50% in 2022.