Russian car dealers have turned to the Ministry of Industry and Trade, openly stating that the Chinese are killing business. Rolf CEO Svetlana Vinogradova said in an interview with Drom.ru that the excess volume of cars from China will kill the dealership business.
The holding's top manager noted that Russian dealers have created a working group together with the Ministry of Industry and Trade to change the situation. Svetlana Vinogradova also says that the goals of the working group contradict the interests of Chinese brands in the Russian Federation.
According to the head of Rolf, an unusual situation has now developed in the Russian car market: in order to earn more, you need to sell less. Svetlana Vinogradova gave 2020 as an example: during the coronavirus pandemic, incomes turned out to be the highest. At that time, Rolf sold few cars, the costs were low, the loans were cheap, and there were subsidies.
Now the situation is different: there is a surplus of cars on the market, these cars put pressure on dealers at the plan level, in order to fulfill the plan, it is necessary to take expensive loans. Dealers are forced to sell cars quickly, “even at a loss“, in order to get money to repay the loans.
According to the estimates of the CEO of Rolf, by January 1, 2025, dealers have accumulated an eight-month supply of cars, and in this situation, all sellers will have negative profitability.
The former president of the Association of Russian Automobile Dealers (ROAD), Oleg Moseyev, agrees with his colleague: in his opinion, the overstocking of cars in warehouses will lead to the exit of some Chinese brands from the market and the bankruptcy of dealers. And Russians are in no hurry to buy cars: in February, demand fell by 25% year-on-year.