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Russians reluctantly embrace Chinese cars after Western brands depart

Hamartia Antidote

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MOSCOW, March 24 (Reuters) - As the exodus of Western carmakers narrows options for Russian consumers, Chinese automakers are filling the gap, forcing Russians to overcome their reluctance to embrace Chinese brands and stomach higher prices.

Chinese brands such as Haval (601633.SS), Chery and Geely (0175.HK) now account for almost 40% of Russia's new car sales, data from analytical agency Autostat and consulting company PPK showed, up from less than 10% in January-February of 2022, pouncing on the opportunity left by the exit of firms such as Renault (RENA.PA), Nissan (7201.T) and Mercedes (MBGn.DE).

But there are teething problems. Reuters spoke to several Russian car buyers - individuals and dealerships - who perceived the quality of some Chinese cars to be lower than Western rivals and industry experts said Chinese manufacturers needed to enhance their reputation even as their market share soars.

Stepan, 28, who has increasingly driven Chinese cars when using carsharing services, is among those that need convincing. Among his complaints was the smoothness of the drive.

"I managed to buy a Skoda in 2022. If you want my honest opinion, the difference (with Chinese cars) is massive," he told Reuters at Moscow's Favorit Motors dealership.

Czech carmaker Skoda Auto, part of Volkswagen Group (VOWG_p.DE) and one of several Western automakers that had local car production, is in the final stages of a deal to sell its Russian assets in the wake of Western sanctions after Moscow despatched troops to Ukraine last February.

When buying his new Chinese car, Alexander, 74, looked for one which encompassed Swedish technology.

"I believe that in time the reliability will improve," he said. "For example, I know that (Geely) Tugella has a Volvo engine. This sold this car for me."

Russia's former president Dmitry Medvedev said on Friday after a visit to China in December that cooperation with Chinese manufacturers was good and consumers' perceptions were out of date.

"We used to laugh at some of their designs, but I went for a ride in a local car and looked at others," he said. "I'll say bluntly: the car I drove was certainly no worse than a Mercedes."

COMPETITION DRIES UP​


Most Western automakers, who have fought with domestic carmakers for market share since they began building factories in Russia in the early 2000s, ceased operations last spring.

"We've lived our whole lives focused on European, Japanese, American brands and did not especially take the Chinese market into account, which...has developed at an incredible rate," said Vladimir Shestak, general director of Altair-Auto in Vladivostok, whose dealership specialises in the Mercedes-Benz and Geely brands.

Though the majority of foreign firms have exited Russia or are in the process of leaving, lingering stocks and parallel imports mean some companies' cars remain on sale for now.

Domestic producer Avtovaz's Lada brand is Russia's most popular. Renault, through its former controlling stake in Avtovaz, had the highest market share among foreign producers before Russia began what it calls its "special military operation" in Ukraine.

While Chinese cars are increasingly filling the gap, the lack of reputation remains an issue, said auto industry expert Sergey Aslanyan.

"Yes, they have almost no competitors here anymore," he said. "But that does not mean that people will change their opinion quickly."

Chinese brands' market share reached 37.15% in January-February, up from 9.48% a year earlier, Autostat and PPK data showed. Sales of departing European, Japanese and Korean brands were down to 22.6% from 70%.

The sharp swing comes, however, amid plummeting sales of new cars, which slumped 58.8% in 2022 as lower living standards and a desire for Western-made vehicles caused people to reduce their spending and purchase more used cars.

In a sign of growing cooperation China's Haval is now producing cars locally, while in Moscow, the revived Soviet-era Moskvich is using engine parts, design and engineering from China's JAC.

But another gripe for consumers is the price. Even Medvedev said the Moskvich's price looked a little high. The model 3 costs around 2 million roubles ($26,195). Prices for the Lada Granta, Russia's most widely sold car, start at around 680,000 roubles.

"(The Chinese) are bringing in a lot of cars but if we talk about price, not quality, there are no cheap cars at all," said Maxim Kadakov, editor in chief of the "Behind the Wheel" magazine.

($1 = 76.3500 roubles)


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Chinese cars are second to none. If the US didn't ban Chinese cars, American brand be facing big competition. In Australia Chinese cars are on the rise.

 
If the US didn't ban Chinese cars, American brand be facing big competition. In Australia Chinese cars are on the rise.

LOL! What Chinese cars did we supposedly ban?

If you mean historically because they weren't passing crash tests well we weren't the only ones banning their cars.


CrashSafety.png

Geely CK crash test that ChatGPT is talking about.

Please post any recent articles about US bans for other reasons other than crash safety. I don't see any.
 
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LOL! What Chinese cars did we supposedly ban?

If you mean historically because they weren't passing crash tests well we weren't the only ones banning their cars.


Please post any recent articles about US bans for other reasons. I don't see any.
That test was at 40mph? Damn… that shit got yeeted and deleted! 😂
 
LOL! What Chinese cars did we supposedly ban?

If you mean historically because they weren't passing crash tests well we weren't the only ones banning their cars.


View attachment 922133

Please post any recent articles about US bans for other reasons other than crash safety. I don't see any.
You’re not living in 2023, you’re pulling videos from 1995. Today Chinese EVs are among the best in the world and there is such a massive diversity of brands. They will likely dominate the world within ten years.
 
You’re not living in 2023, you’re pulling videos from 1995. Today Chinese EVs are among the best in the world and there is such a massive diversity of brands. They will likely dominate the world within ten years.

Yes, so what bans are they supposedly getting?
I think he is the one thinking back 20 years not us.
 
What are you even talking about

I said I see no bans of Chinese cars in the US.

I have no idea why he thinks there are bans unless he somehow is talking about bans years ago of certain Chinese cars due to them failing crash tests.

Have you heard about these so-called recent bans of Chinese cars that he is mentioning? Maybe he is just talking out of his *** as usual.
 
I said I see no bans of Chinese cars in the US.

I have no idea why he thinks there are bans unless he somehow is talking about bans years ago of certain Chinese cars due to them failing crash tests.

Have you heard about these so called bans of Chinese cars that he is mentioning? Maybe he is just talking out of his *** as usual.
Well I’m sure when they start showing up, there is going to be massive push back. I don’t see how they can be allowed to thrive in the US market in todays environment.
 
Well I’m sure when they start showing up, there is going to be massive push back. I don’t see how they can be allowed to thrive in the US market in todays environment.

Likewise, China de facto banned Boeing from the Chinese market.
 
Well I’m sure when they start showing up, there is going to be massive push back. I don’t see how they can be allowed to thrive in the US market in todays environment.

Well Geely can come in under Volvo and SAIC can come in under MG.

BYD will have a problem selling a $30K+ car as a complete unknown.
 
Anyway the fact is that China has found a gap and filled it. I love the Chinese business model.

Couldn't have said it any better. Chinese are promoting XPENG luxury model over here in Europe and people are liking it. Just wait a few years.
 
Well Geely can come in under Volvo and SAIC can come in under MG.

BYD will have a problem selling a $30K+ car as a complete unknown.
There is no way a major Chinese carmaker is going to be allowed to gain traction in this political environment. That’s probably why most have been extremely cautious about even investing in trying to enter the US market.
 
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