The Russian car market is on track to surpass the German market and become the largest in Europe by 2020, and the fifth largest in the world.
Western companies, including General Motors, Ford, Renault, and Fiat, have made significant investments in Russia, hoping for an increase in car sales as a growing number of middle-class individuals in the country can afford to buy their first car or replace an old one.
In Russia, there are only 290 cars per 1,000 inhabitants – compared to 560 in Western Europe – and many of these vehicles are old. The Russian economy, driven by the export of mineral resources, has experienced significant growth over the last decade, which has fostered the emergence of an expanding middle class.
A report by the consulting firm BCG states that the Russian automotive market could grow at a rate of six percent annually until 2020, when it is expected to reach annual sales of 4.4 million new vehicles. This would allow Russia to overtake Germany and become the fifth largest automotive market in the world, behind China, the USA, India, and Brazil. Russia was ranked tenth on this list in 2009.
