Developing a competitive Russian automotive supplier industry

Findings of a study carried out by the Ost-Ausschuss der deutschen Wirtschaft, the Verband der Automobilindustrie (VDA) and Roland Berger Strategy Consultants.

• Car boom: The number of new cars in Russia will increase by 6% per year until 2014
• International manufacturers are especially benefiting from the situation
• The number of foreign suppliers is growing
• The economic framework is decisive

The Russian automotive market will become one the world's biggest growth markets within the next ten years. According to a study conducted by Roland Berger, the Ost-Ausschuss der deutschen Wirtschaft and the Verband der Automobilindustrie (VDA), in which 55 leading international automotive companies participated, the number of new cars in Russia will increase from 1.3 million in 2004 to 2.3 million in 2014.

This represents an annual growth of 6 percent, which international automotive manufacturers will particularly benefit from: annual new car imports to Russia will grow from 300,000 in 2004 to 700,000 in 2014. In the same time period, the number of foreign cars assembled in Russia will skyrocket from 100,000 to 800,000.

International suppliers will also benefit from this boom: 43 percent are planning to expand their presence in Russia over the next three years. How fast the Russian automotive market will catch up to western standards will largely depend on economic policy.

In the first quarter of 2005, political decision-makers and 55 international and Russian automotive manufacturers and suppliers were interviewed on the Russian automotive sector as part of the study.