Market Report Russian Automotive Market: Passenger Cars, Components and Spare Parts 2006 - 2010 June 2007 Globis GmbH Möllendorffstr. 52, 10367 Berlin Germany T.: +49 (0)30 4005 4914 (Sales) F.: +49 (0)30 4005 4928 Russian Automotive Market: Passenger Cars, Components and Spare Parts, 2006-2010 Table of Contents TABLE OF CONTENTS ........................................................................................................... 2 TABLE OF FIGURES ................................................................................................................ 4 1 SUMMARY .......................................................................................................................... 6 2 COUNTRY BASICS ............................................................................................................ 9 2.1 Economic Development .......................................................................................................... 10 2.2 Comparison with European Union .......................................................................................... 12 2.3 Regional Economic Development ........................................................................................... 14 3 RUSSIAN PASSENGER CAR MARKET ...................................................................... 18 3.1 Russian Car Parc ..................................................................................................................... 18 3.1.1 Structure of Car Parc by Age ............................................................................................... 19 3.1.2 Structure of Car Parc by Models ......................................................................................... 20 3.1.3 Car Parc in Regional Markets .............................................................................................. 23 3.1.3.1 Passenger Car Parc of Moscow ...................................................................................... 25 3.1.3.2 Passenger Car Parc of St. Petersburg ............................................................................. 27 3.1.3.3 Passenger Car Parc of Krasnodar Region ....................................................................... 28 3.1.3.4 Passenger Car Parc of Kaliningrad Region ...................................................................... 28 3.1.3.5 Passenger Car Parc of Primorskiy Region ....................................................................... 29 3.1.3.6 Passenger Car Parc of Novosibirsk Region ..................................................................... 30 3.1.3.7 Passenger Car Parc of Rostov Region ............................................................................. 31 3.2 Passenger Car Sales and Imports ............................................................................................ 32 3.2.1 Size of Market ..................................................................................................................... 32 3.2.2 Sales Drivers ........................................................................................................................ 39 3.2.2.1 Car Loans ........................................................................................................................ 39 3.2.2.2 Local Production Projects of Foreign Car Makers .......................................................... 40 3.2.2.3 Dealership Networks / Distribution Systems ................................................................. 44 3.2.2.4 Consumer Preferences ................................................................................................... 50 4 RUSSIAN COMPONENTS AND SPARE PARTS MARKET .................................... 53 4.1 Market Size for Components and Spare Parts ......................................................................... 53 4.1.1 Primary Market ................................................................................................................... 53 4.1.2 Secondary Market ............................................................................................................... 58 4.2 Distribution System for Spare Parts ........................................................................................ 63 4.3 Consumer Behaviour Regarding Car Service and Spare Parts .................................................. 70 Globis Consulting, www.globis-consulting.com, Tel +49 (0)30 4005 4914 2 Russian Automotive Market: Passenger Cars, Components and Spare Parts, 2006-2010 5 APPENDICES .................................................................................................................. 73 5.1 Districts and Regions in Russia ................................................................................................ 73 5.2 Population and Area in Regions .............................................................................................. 74 5.3 Major Russian Cities ............................................................................................................... 77 5.4 Regions by Level of Economic Development ........................................................................... 82 5.5 Regional Passenger Car Parcs ................................................................................................. 84 5.6 Custom Regulation for Car Imports ......................................................................................... 88 5.6.1 New Cars ............................................................................................................................. 88 5.6.2 Second-hand Cars ............................................................................................................... 88 5.6.3 Non-Compliance with Euro 2 Norm .................................................................................... 89 5.7 Sales of Foreign Brands in Russia, 2005-2007 .......................................................................... 90 5.8 Sales by Car Models Q1 2006 to Q1 2007 ................................................................................ 92 6 ABBREVIATIONS .......................................................................................................... 94 Globis Consulting, www.globis-consulting.com, Tel +49 (0)30 4005 4914 3 Russian Automotive Market: Passenger Cars, Components and Spare Parts, 2006-2010 Table of Figures Figure 1: Russia - Country Facts, 2007 ............................................................................................................... 9 Figure 2: Russian Federal Districts ................................................................................................................... 10 Figure 3: Population development, in 1.000, 2005-2009................................................................................. 10 Figure 4: Development of Nominal GDP, USD bn., 2004-2010 ........................................................................ 11 Figure 5: Development of GDP Growth Rates, Change in % to Previous Year, 2001-2010 .............................. 11 Figure 6: Development of Real Income / Capita, in Rouble, 2000-2010 .......................................................... 12 Figure 7: Comparison of Key Figures EU / Russia, 2006 .................................................................................. 13 Figure 8: Share of Leading Regions in Total GDP, 2006 ................................................................................... 15 Figure 9: Income per Capita in Regions, 2006 ................................................................................................. 16 Figure 10: Growth of Retail Expenditures per Capita, 2006-2009 ................................................................... 17 Figure 11: Leading Regions by Share in Total Volume of Retail Trade, 2006 .................................................. 17 Figure 12: Development of Passenger Car Parc, Total and Foreign, in mio., 1993-2010* .............................. 18 Figure 13: Passenger Car Sales in Russia and Selected European Countries, 2005-2010 ................................ 19 Figure 14: Structure of Russian Car Parc by Age in 2006 ................................................................................. 20 Figure 15: Top-Ten Brands in Russian Car Parc, 2006 ..................................................................................... 21 Figure 16: Car Parc of Foreign Brands in Russia, in 1.000, 2007 ..................................................................... 22 Figure 17: Popular Models among Foreign Brands in Russia, 2007 ................................................................ 23 Figure 18: Passenger Car Parcs of Federal Districts, 2006 ............................................................................... 24 Figure 19: Rating of Regional Car Parcs by Number of Vehicles, 2006 ............................................................ 25 Figure 20: Moscow Car Parc: Top 10 Foreign Brands, in 1.000, 2006 ............................................................. 26 Figure 21: St. Petersburg Car Parc: Top 10 Foreign Models, in 1.000, 2005.................................................... 27 Figure 22: Krasnodar Region Car Parc: Top 10 Foreign Models, in 1.000, 2006 .............................................. 28 Figure 23: Kaliningrad Car Parc: Top 10 Foreign Brands, in 1.000, 2005 ........................................................ 29 Figure 24: Primorskiy Region Car Parc: Top 10 Foreign Brands,