Leverage for the car market

Experts predict stagnation in the car market, which will negatively affect transportation by rail.



Over the past two years, Chinese manufacturers have become the main suppliers of new cars in Russia, which has provided a powerful impetus for the development of projects in the field of delivery of machines and their components, said the head of the JSC «RZD Logistics» Olesya Larionova during the conference «Logistics of ready-made cars».

Over the 11 months of 2024, 3 million tons of cars and their components were transported through JSC RZD’s network, which is broadly in line with the same period of 2023 (0.6% growth, or +0.02 million tons), according to data from the Corporate Transport Service Center (CSTC) of JSC RZD.

«The driver of positive dynamics was the import, providing more than 60% of the total volume of said shipments, increased by 19.6%, or 0.3 million tons - to 1.9 million tons», explained deputy head of TFTU Irina Azhikin.

According to TFATF, more than 66% of imported vehicles and components are transported through ports and border crossings in the Far East, another 26% via border crossings with Kazakhstan, 7% via ports and border crossings in the North-West.

«Regarding the technology of these transports, it should be noted that 93% of imports of both cars and their components are transported in containers», said Irina Agikin. Therefore, this cargo is an important part of the holding’s container trade. According to the published data of JSC «RZD», in January-November 2024 on the network of JSC «RZD» in all types of communication transported 467.8 thousand containers of DFE with cars and accessories, which is 4% more than in the same period of 2023. In the general carriage of container goods, vehicles and components are included in the five main categories of goods shipped in containers.

The domestic economy is in a bad year. While the auto market grew by about 49% in 2024, it rose from 1.5 trillion ruble to 2.3 trillion ruble. , as the head of sales development of auto credit OTP Bank Andrei Zalish notes, this year the loan portfolio will be reduced due to high key rate of central bank and rising borrowing costs.

In addition, slowing the growth of car sales in 2025 may be a sharp increase in the recycling fee (from October 1, 2024 to 70-85% when importing a car from abroad) and its annual indexation, Chairman of the Committee of Auto Manufacturers of the Association of European Business Alexei Kalitsev.

As calculated in «Autostat», in the base scenario sales of new cars in the RF can decrease by 10%.

«Our average forecast now says that the decrease will be 10% compared to last year, if nothing changes», - said director of «Auto-statis» Sergei Celikov.

If the CBR continues to hold a high key rate, the situation may worsen. According to the pessimistic forecast of «Autostatis», sales of new cars may decrease by 20%.

In the near term, a strengthening of the trend towards a decline in consumer activity and a market collapse due to credit appreciation is possible. In this case, to maintain the volume and further market growth will require significant support from the state», - says Alexei Kalitsev.

Recall that in December 2024 the Government of the Russian Federation allocated an additional 18 billion rubles. to preferential programs of car loans and car leasing in the Russian Federation. In 2024, 45 billion rubles were allocated from the budget, of which 17.3 billion rubles. - to reimburse banks for discounts on concessionary auto loans and 9 billion rubles. - Discounts on concessionary leasing programs. In 2025, it is planned to allocate 36 billion rubles to the concessionary car loan program. , preferential leasing - 27 billion rubles. , Tigran Parsadanyan, the director of the Department of Automotive and Railway Engineering of the Ministry of Industry of the Russian Federation, reported. Such an increase in state support of motor vehicles can stabilize sales of new cars, market participants believe.

While in 2023 we saw an explosive increase in the volume of imports of finished cars from China to Russia simultaneously on all routes, in 2024 the situation stabilized - flows became more uniform, they can now be predicted and long-term planning is established supply, - explained Alexey Rylskyi, head of the development department of the Automotive sector of the FESCO Transport Group.  - Of course, news about the introduction of a recycling levy in 2024 caused thrice a stir among importers - then logistics flows of ready-made cars from China were sharply realigned to Vladivostok and overland crossings for shipments to cross the border with Russia as quickly as possible. However, the rest of the year was more or less stable.

Another trend is the beginning of the localization of Chinese car production in Russia. The number of machine kits and components shipped in containers has increased. This trend will continue throughout the current year. The shift of the cargo base towards components is directly related to the provision of automotive enterprises, which require from suppliers rhythm rather than urgency of shipments. As for the bottom line, in 2024 sales of new Chinese cars were ahead of 2023, although the previously-seen deficit is already covered.

The key advantages of transporting finished cars by rail are the possibility of shipping large volumes and the regularity of deliveries. In addition, the tariffs for transporting cars in containers on the network of JSC «RZD» is really lower compared to road transport. Mesh wagons - traditional mobile train for the transport of ready-made cars on the network of JSC «RZD». However, their number is limited and new units are not produced today. Therefore containers have become a rescue for carriers and suppliers. For example, according to our analysts, in 10 months of 2024, about 150 thousand cars were transported in grid wagons. While 380 thousand were sent in containers, that is 2.5 times more.

«This year, high credit rates, tightening of the conditions for issuing loans, weakening of the ruble and, as a consequence, rising prices of cars - predicts the president of the association «Russian automobile dealers» Alexei Podshchekoldin. - Add to this an increase in the disposal fee. According to our baseline forecast, sales of cars will fall to 1.45 million units by 2025. We hope that the growth of the number of Chinese brands in the Russian market will be halted and there will be an increase in the share of domestic production models». 

There are now about 60 brands on the market. Competition is intensifying not only between Chinese manufacturers, but also among domestic ones. Today, foreign deliveries are made by official importers from China.

We are considering options from India and Iran, but so far the entry into the Russian market is only in the development stage. In this case, the shipment of cars from India can be done on multimodal routes using sea and rail transport, and from Iran on MTK North-South. Of course, such competition is good for the buyer, but only if these brands are backed by quality service, manufacturer’s guarantee and confidence in the stability of the brand on the Russian market. It is no secret that in 2025 some brands may leave the market due to market contraction. The remaining will develop new logistics routes - Alexei Podshechkoldin is convinced.