The Russian Passenger Car Market, As Part Of The Global Market. The State And Prospects Of Development

Over the past 20 years, the automotive products market in Russia has significantly changed. In the early 90’s our market was mostly dominated by local manufacturers. Despite substantial claims of customers concerning the quality of cars, the industry looked to be advantageous due to the relatively low prices for their products and developed network of car dealers and car repair garages, where it was possible at any moment to repair the car or buy spare parts. Foreign manufacturers could offer the consumer a good quality, but at a higher price. However, the image of the Russian car market in the 90’s began to change. Burdened by the problems of the transition economy , the Russian manufacturers could not and did not want to invest in the modernization of production and a in acute long term quality increase. Moreover, they did not have the proper incentives. The customs protection in internal Russian car market created an artificial price protection for domestic manufacturers. On the one hand, the customs protection prevented the bankruptcy of domestic manufacturers and related indus-tries, saved millions of jobs and stable taxpayers. But on the other hand, the situation contributed to the preservation of many negative and non-market factors of automobile companies, lacking again the stimulus for large-scale upgrade and transition to new approaches. Russia’s entry to the World Trade Organization means that Russian producers will be forced to exist on the domestic market on equal terms with major international competitors.Â