MINISTRY OF SCIENCE AND HIGHER EDUCATION OF
THE RUSSIAN FEDERATION
PLEKHANOV RUSSIAN UNIVERSITY OF ECONOMICS
INTERNATIONAL BUSINESS SCHOOL AND GLOBAL
ECONOMICS
Coursework in Microeconomics
“Impact of Automotive Industry on Russian economy.”
Teacher: Nivikova E.S.
Student: Tischenko M.I.
Group: 5204
2
CONTETNS
INTRODUCTION............................................................................................... 4
1. THEORETICAL ASPECTS OF THE AUTOMOTIVE INDUSTRY ........... 6
1.1 Concept and history of the automotive industry ........................................... 6
1.2 Importance of the automotive industry in the economy ............................... 8
1.3. Problems of the automotive industry ......................................................... 10
2. AUTOMOTIVE INDUSTRY OF FOREIGN COUNTRIES ....................... 12
2.1. The current state of the automotive industry of foreign countries............. 12
2.2. Volumes and distribution of the car market of foreign countries .............. 14
2.3. Forecast of car market volumes in foreign countries ................................. 16
3. AUTOMOTIVE INDUSTRY OF RUSSIA ................................................. 19
3.1. The current state of the automotive industry of the Russian Federation ... 19
3.2. The largest enterprises of the automotive industry of the Russian Federation
..................................................................................................................................... 22
3.3. Features of the influence of the automotive industry on the economy of the
Russian Federation ...................................................................................................... 26
CONCLUSION ................................................................................................. 29
BIBLIOGRAPHY ............................................................................................. 31
3
INTRODUCTION
Modern automotive industry is the leading branch of mechanical engineering in
industrialized countries, influencing the processes of economic and social development
of society. It gives impetus to the development of other industries, stimulates the
employment of the population both in the production of automotive equipment and its
components, and in the maintenance of motor transport.
World experience shows that the presence of its own automotive industry is one
of the main elements of ensuring national security. Automotive production is
developing on the basis of the achievements of fundamental and applied science and
being at the same time an important factor in scientific and technological progress.
The automotive industry is the industry that is able to pull out all other industries.
This is explained by its integrating role, since metallurgy, chemistry, electrical
engineering, instrument making, light industry, etc. are connected with it in terms of
supplies. In Russia, about 800 thousand people directly work in this industry, and in
general - almost 10 % of the working-age population directly or indirectly work "for
the car."
Among the "automobile" powers, Russia confidently enters the top ten in terms
of the number of cars produced, holding 2.5% of world output. Taking into account the
integrating and social role of the industry, taking into account the processes of
globalization and their vivid manifestation in the global automotive industry, as well
as the noticeable lag of Russian cars in terms of quality characteristics from world
leaders, it is hardly necessary to let things take their course and wait whether the
industry adapts to the global situation or will die.
In the strategy of integrating the Russian automotive industry into the global
automotive industry without social upheavals and without serious damage to the needs
of consumers, it is necessary to combine an increase in the quality of domestic cars
against the background of price proportions acceptable to consumers with the provision
of attractive conditions for foreign capital to invest in the development of the
automotive industry.
4
The place and role of Russia in the world market of the automotive industry was
paid attention to by many scientists and economists, such as I. T. Abdukarimov, I. S.
Alekseev, E. A. Arustamov, A. Yu. Arkhipov, E. P. Babin, V. A. Barinov, O. I.
Dyagterova and many others.
The aim of the work is to investigate the impact of the automotive industry on
the Russian economy.
The object of study is the automotive industry
The subject of the study is the peculiarities of the influence of the automotive
industry on the Russian economy.
To achieve a certain goal, the following tasks arise:
– to study the theoretical aspects of the automotive industry,
– consider the automotive industry of foreign countries,
– to study the impact of the automotive industry on the economy of the Russian
Federation.
The presented work uses federal laws and regulations of the Russian Federation
regulating the automotive industry, materials published in periodicals, as well as
Internet resources.
Structurally, the work consists of an introduction, three chapters, a conclusion, a
list of references.
5
1. THEORETICAL ASPECTS OF THE AUTOMOTIVE INDUSTRY
1.1 Concept and history of the automotive industry
A branch of engineering that manufactures mainly cars, as well as motorcycles,
bicycles, forklifts.
The automotive industry or automobile industry is a separate branch of modern
industry that specializes in the design and construction of vehicles that do not use a rail
base, in which an autonomous engine is installed that sets the entire car in motion.
Usually they use an internal combustion engine, but recently alternative motor power
sources have become more and more popular.
The Russian Empire had a long history of progress in the development of
mechanical engineering. Back in the eighteenth century, Ivan Ivanovich Polzunov built
the world's first two-cylinder steam engine, and Ivan Pavlovich Kulibin created a
human-powered vehicle that had a flywheel, brake, gearbox, roller bearings.
One of the world's first tracked vehicles was invented by Fedor Aleksandrovich
Blinov in 1877.
In 1896, the Yakovlev Motor Plant and the Frez car-building workshop produced
the first car in Russia with a gasoline engine, Yakovlev and Frez.
The turn of the nineteenth and twentieth centuries was marked by the invention
of the earliest Russian electric car nicknamed "Cuckoo", which was created by engineer
Ippolit V. Romanov in 1899. Romanov also built a battery-electric omnibus.
In the years leading up to the October Revolution of 1917, Russia produced an
increasing number of Russo-Baltic, Puzyrevsky, Lessner and other cars, held its first
motor show in 1907, and had motorists who successfully participated in international
motor racing. The Russo-Balt car took 9th place in the 1912 Monte Carlo Rally, despite
extreme winter conditions that threatened the life of the driver and mechanic on the
way from St. Petersburg, 2nd place in the San Sebastian Rally and covered over 15,000
km in Western Europe and North Africa in 1913. The driver of the car, Andrei
Petrovich Nagel, was personally awarded by Emperor Nicholas II for raising the
prestige of the domestic automobile brand.
6
In 1916, as part of a government program to build six large automobile plants,
the Kuznetsov Trading House, Ryabushinsky and Co. created AMO (later renamed the
First State Automobile Plant, ZIS and ZIL), but none of the plants was completed due
to the political and economic collapse which followed in 1917.
Since the 1980s, there has been a trend in the automotive industry for the
introduction of products by the electronics industry, represented by engine
management systems, gearboxes and transmissions, and much more.
In the 21st century, the most significant areas have become the development of
environmental and economic indicators, improving safety, improving driving
performance, etc.1
In the automotive industry, different types of metals are used. First of all, it is
iron and its alloys: steel and cast iron. For the manufacture of parts, grades of lowcarbon and medium-carbon sheet steels are used, provided for by GOSTs. Most body
parts are steel and aluminum alloys. Cast iron is the main material for cylinder blocks,
clutch and gearbox housings and other interior fittings.
In the production of trackless vehicles - cars and motorcycles - non-ferrous
metals are also used. These include aluminum, magnesium, copper, titanium, tin,
magnesium, zinc and others. Non-ferrous metals have valuable properties: high thermal
and electrical conductivity, ductility, corrosion resistance.
In addition to ferrous and non-ferrous metals, aluminum and magnesium-based
alloys, zinc, and anti-friction alloys are widely used in the automotive industry. Alloys
are used to make pistons, rivets, bearings, engine liners and other parts.
The automotive industry is developing according to the laws of the market.
Competition is growing, new brands are entering the market, following this, the
requirements for structural materials are changing. Today, the emphasis is on
increasing strength at the same time as reducing weight: lighter construction leads to
lower fuel consumption.2
1
Mashkin A.L., Gogolina E.S., Telushkina E.K. Analysis of the state of road transport in 2018-2020 and the prospects for its development,
taking into account the consequences of the Covid-19 pandemic // Economics and business: theory and practice. 2021. No. 2-1.
2
Madhawan Ch., Rajan KS, Sudharshan R. Development of high strength steel sheet with improved strain hardenability for automotive
application // Proceedings of Higher Educational Institutions. Ferrous Metallurgy. 2019. V. 62. No. 11. S. 827-832
7
1.2 Importance of the automotive industry in the economy
The modern automotive industry is a complex system of industrial production,
which includes a number of specialized industries, as well as additional and auxiliary
industries. The most important and largest industry is the production of passenger cars,
followed by the production of buses, the production of trucks and the production of
special vehicles.
Objectively, Russia is not a leader in this area, not even covering the needs of
the domestic market, however, the capacities available since the times of the USSR
make it possible to occupy a significant share in world production volumes.
The existing plants produce products that are used in other sectors of the
country's economy, as well as in the military-industrial complex. A significant share of
trucks and special equipment produced by domestic enterprises is exported to other
countries.
In the production of passenger buses, the Russian Federation retains one of the
leading places in the world, despite the fact that after the collapse of the Soviet Union,
this particular industry suffered the greatest losses and was in an extremely difficult
situation from the 90s to the early 2000s.
The automotive industry is closely related to such sub-sectors of mechanical
engineering as engine building, the production of auto components, including car tires,
as well as machine tool and robot building for the manufacture of technological
equipment.
Based on this, a characteristic feature of this type of industrial production is a
high level of capital costs, as well as equipment costs. Equally important is the skilled
labor force, whose remuneration also implies high costs.
For the reasons mentioned above, the full-cycle automotive industry is not
represented in every country. The world leaders in this industry are the USA, France,
Germany, South Korea, China, and Japan. Separate production facilities are available
in the UK, Sweden, Italy, the Czech Republic, India and some other countries.
8
The development of maximum speeds, the achievement of a high level of
comfort, the provision of vehicles with advanced achievements in information
technology - these are the priorities of the modern automotive industry.3
The significance of the automotive industry, in general, is as follows:
1. In industrialized countries, the automotive industry has long been not only the
leading branch of engineering, but also one of those key sectors of the national
economy that ensure the successful achievement of national economic, social,
scientific, technical and environmental goals.
2. The development of car factories leads to a steady growth in employment and
welfare of the population. Calculations show that one job in the automotive industry
creates 7-8 jobs in related industries, and taking into account the sphere of trade, car
service and recycling - 10 jobs. The production of automobiles, in addition to
employment of the population, increases the volume and speeds up the time of trade,
strengthens the financial system, and provides the possibility of sustainable production
of the accompanying mass of goods and services.
3. The development of the automotive industry is based on the achievements of
fundamental and applied science. It gives impetus to scientific and technical
developments in various fields of knowledge, and their implementation at car factories
allows, thanks to mass production, to quickly pay off the costs of their implementation.
Putting into production of each new model necessarily requires new technical and
technological solutions, both in the automotive and related industries. Thus, the
automotive industry is constantly "forcing" related industries to continuously increase
production.
4. The automotive industry contributes to the dynamic development and
modernization of a whole range of related sectors of the economy, determines the
prerequisites for the development of the transport system and other infrastructure links,
ensures the country's defense capability, and radically changes the mentality and even
the way of life of the nation. The activities of automotive industry enterprises create a
3
Lee CG, Kim SJ, Lee TH etc. Effects of volume fraction and stability of retained austenite on formability in a 0.1C - 1.5Si - 1.5Mn - 0.5Cu
TRIP-aided cold-rolled steel sheet. mater. sci. Eng. A. 2019, vol. 371, no. 1-2, pp. 16 - 23
9
multiplier effect in the development of almost all major sectors of the national economy
that provide the automotive industry with materials, components and technological
equipment, as well as means of maintenance, operation and repair.4
1.3. Problems of the automotive industry
The automotive industry today is one of the most science- and capital-intensive
branches of engineering. Almost all engineering products are used in the automotive
industry. All the "novelties" of science and technology are widely used in this industry.
The main differences between the automotive industry and other industries:
– With an increase in business activity, traffic flows increase, since transport is
used to solve various economic problems.
– The automotive industry is one of the most knowledge-intensive and high-tech
industries. It "pulls" many other industries with it, the enterprises of which carry out
its numerous orders. Innovations introduced in the automotive industry inevitably force
these industries to improve their production as well. Due to the fact that there are quite
a lot of such industries, as a result, there is a rise in the entire industry, and,
consequently, the economy as a whole.
- The automotive industry in all developed countries is one of the most profitable
sectors of the national economy, as it contributes to an increase in trade and brings
considerable income to the state treasury through sales both on the domestic and global
markets.
– The automotive industry is a strategically important industry. Its development
makes the country economically strong and therefore more independent. The
widespread use of the best examples of automotive technology in the army undoubtedly
increases the country's defense power.
The collapse of the Soviet Union had an extremely negative impact on the
economy and the national economy of all the states that previously made it up. The
Russian automotive industry was no exception in this case. Already in the first half of
4
Yong Tian, Jhuang Li. Effects of warm deformation on mechanical properties of TRIP aided Fe - C - Mn - Si multiphase steel. Journal of
Iron and Steel Research International. 2020 Vol. 19, no. 6, pp. 47-52
10
the 90s, production fell by almost half compared to 1989. The reason for such a largescale crisis in the industry was the rupture of traditional ties and production chains
between the former Soviet republics. The loss of sales markets, the fall in the standard
of living of the population, the collapse of industrial and agricultural production as a
whole also played a role.
The main current problem of the modern domestic automotive industry is the
low level of investments from the state and private investors in the development of the
industry. For this reason, to a large extent, there is a technical backwardness and a
small amount of modern industrial capacity. This circumstance does not allow the
Russian passenger car industry to compete with cars of foreign manufacturers either in
foreign markets or even in the domestic one. The latter circumstance forces the
Government of the Russian Federation to use tough protectionist measures (for
example, protective duties on foreign cars) to maintain the artificial competitiveness of
the domestic auto industry within Russia, which also does not benefit it in the end.5
In addition, outdated equipment and production facilities, as well as the
difficulties associated with administrative barriers, generate significant costs and
increase the cost of car production. This means that in the context of the crisis and the
low purchasing power of the country's population, the level of demand remains not as
high as it is necessary for a radical modernization of the automotive industry.
It should be noted that these problems are largely related only to the production
of passenger cars. The truck industry is more developed and economically sustainable.
This is due, firstly, to the fact that the products of the respective factories are used for
the needs of the army and other law enforcement agencies. Secondly, trucks and special
equipment are successfully exported to many countries of the world, where they are in
great demand.6
5
S.Yue, Chiro Diet etc. Thermomechanical processing effects on C - Mn - Si TRIP steels. Journal of the minerals metals & materials Society.
2019, vol. 49, no. 9, pp. 59-61
6
Hofmann H., Mattissen D., Schaumann TW Advanced cold rolled steels for automotive applications. Steel Research Int. 2020 Vol. 80, no.
1, pp. 22-28
11
2. AUTOMOTIVE INDUSTRY OF FOREIGN COUNTRIES
2.1. The current state of the automotive industry of foreign countries
The main contribution to sales growth was made by passenger cars — 3.76%
y/y. This directly reflects the growth in incomes of the population, structural changes
in consumer habits and the growth of the world's population. Sales of commercial
vehicles, including heavy trucks and buses, are less volatile and increased by about
2.1% y/y.
China, Europe, the US, Japan and India together account for about 77% of the
global passenger car market and 83% of the commercial vehicle, heavy truck and bus
market.
Figure 1 - Market share of passenger cars by key sales regions, 2005–2020, %.7
Car sales in China, India and other Asia-Pacific countries are growing at a faster
pace. In particular, sales of passenger cars in the Chinese market increase by 12.76%
y/y, in India - by 7.26%.
7
Догузов Г.Т. Анализ мирового рынка и производства легковых автомобилей в современных условиях // Московский
экономический журнал. 2021. №7.
12
Figure 2 - Market share of commercial vehicles by key sales regions, 2005–
2020, %.8
In 2020, due to the COVID-19 pandemic, global passenger car sales decreased
by 15.9% year-on-year to 53.6 million units. Sales of commercial vehicles decreased
by 8.7% to 24.37 units.
Europe and South America were among the hardest hit regions, with car sales
down by about a quarter by 2019. In the US and India, sales fell by about 17%, in
Russia and Japan - by 10%. In China, the largest and most dynamically developing
automotive market in the world, by 6.1% and amounted to just under 20 million cars.
However, due to large-scale monetary and fiscal support measures from
governments, as well as thanks to zero interest rates and quantitative easing from key
Central Banks, demand for transport began to recover already in the second half of
2020. In the first half of 2021, all major markets recorded double-digit growth in
vehicle sales compared to 2020 figures:
– in China, sales were 9.83 million units, up 27%;
– in the US, sales increased by almost a third (+29%) to 8.294 million units;
– European passenger car market increased by 27% y/y to 6.486 million units;
8
Galindo-Rueda F., Verger F. OECD Taxonomy of Economic Activities Based on R&D Intensity. OECD Science, Technology and Industry
Working Papers, 2016/04, OECD Publishing, Paris. URL: link
13
– in Japan, Brazil and Russia, sales increased by 12%, 32% and 37%,
respectively, to a total of 3.914 million units;
- Passenger car sales in India almost doubled - +93%, reaching 1.495 million
new cars.
Despite double-digit sales growth, results are still lower than in 2019. This is due
to the shortage of semiconductors, which does not allow the market to recover. Supply
chain disruptions are temporary hardships, and declining automaker stock prices are
likely a long-term investment opportunity at a discount.9
2.2. Volumes and distribution of the car market of foreign countries
By the end of 2021, there will be about 1.446 billion vehicles in the world,
including all types of cars and commercial vehicles. Asia accounts for ⅓ of all vehicles,
Europe is second in terms of transport volume, and the United States is third. At the
same time, the total number of cars in the world per capita (APC) is uneven. The United
States leads with 810 cars per 1,000 people, the UK with 610, and Europe is third with
520. The rest of the regions, including the emerging markets of the Asia-Pacific region,
have a lower indicator - from 140 to 220.
The average age of vehicles on American roads continues to rise and has already
reached 12.5 years for cars and 11.6 for trucks. In Canada, the situation is slightly better
- 10.5 and about 11 years for cars and commercial vehicles, respectively. In Japan, the
figure is 9 years for passenger cars.
In the European Union, the average age is 12 for cars and 13.5 for trucks. In
India, the median age for all types of cars is 12 years, while the country has a maximum
age limit of 15 years for petrol cars and 10 for diesel cars. At the end of its service life,
the car must be scrapped and supporting documents must be presented to the
authorities.
9
Sobirzhonov A., Niyazova GP Lubricant-cooling and technological fluids of the machine-building and automotive industries based on waste
vegetable and animal oils // European Science. 2020. No. 7 (56). pp. 20-21
14
In China, the car fleet is much younger: the average age of cars is about 5.5 years,
commercial - 7.5 years. However, the low number of cars per capita, the rapidly
growing economy and the well-being of the population of the country contribute to the
strong growth of car sales in China. Since 2005, the growth rate here has been 12.8%
y/y.
The South American automotive market has huge growth potential and could
become one of the world's four largest sales markets by 2030. With an average age of
10.5 years for passenger cars and 11.4 for commercial vehicles, Brazil is the largest
country in South America, occupying almost half of the continent. This makes Brazil
the region's largest automotive market.
Over the past decade, the average age of vehicles on the roads in most parts of
the world has increased significantly. This was a consequence of the 2008–2009 crisis.
and the coronavirus pandemic in 2020. By comparison, in the 1980s, the average age
of cars in the US was less than 7 years, and trucks were about 6.5 years old.10
The 2009 global recession triggered by the global financial crisis was the deepest
since the Great Depression. The advanced economies over the next decade showed the
lowest GDP growth rates, and a number of emerging economies faced the devaluation
of their national currencies. This limited the purchasing power of the population. The
coronavirus pandemic and the lockdown of the global economy in 2020 have also had
a negative effect. This led to a delay in the supply of necessary auto components and a
decrease in the production of new cars.
As a result, the share of road transport in the United States increased to 35.3%
for ages 6–10, up to 39.1% for ages 11–20, and even though it declined to 9.8% over
21, it is still significant. Given the high degree of globalization of the automotive
market, similar trends can be expected in Canada, the EU, Brazil, Russia, the CIS and
Asia (excluding China).11
10
Tao Fu-Yong, Jing Liu etc. Effects of cold rolling reduction on retained austenite fraction and mechanical properties of high-Si TRIP steel.
Journal of Iron and Steel Research International. 2020 Vol. 20, no. 5, pp. 50-56
11
Bhadeshia HKTRIP-assisted Steels? ISIJ Int. 2020 Vol. 42, no. 9, pp. 1059-1060
15
Figure 3 - Age categories of cars of all types in the United States.12
The need to replace the aging fleet, the dominant part of which is equipped with
internal combustion engines, with new and environmentally friendly vehicles is the
main factor in the growth of the global automotive industry in the coming decade.
2.3. Forecast of car market volumes in foreign countries
Due to the outpacing growth of GDP per capita, the number of cars in developing
countries will continue to grow. At the same time, the growing popularity of carsharing
and the car-by-subscription model will increase the use of passenger cars, a significant
part of which will move from private customers to fleet operators.
Deloite estimates that through the development of shared mobility in 2035, the
average vehicle utilization rate will be:
– 25,000 km/year (base case) and 32,000 km/year (breakthrough scenario) in
China;
- 26,000 km / year and 29,000 km / year - in the USA,
– 19,000 km/year and 24,000 km/year in the EU;
- 18,000 km / year and 27,000 km / year - in Japan.
12
Догузов Г.Т. Анализ мирового рынка и производства легковых автомобилей в современных условиях // Московский
экономический журнал. 2021. №7.
16
On average around the world, the negative impact of the trend towards joint
mobility on the development of the global automotive industry can be estimated at
about 20%. In this case, the growth in the number of cars by 2035 will be about 1.12
billion units in the countries of the Asia-Pacific region, 120 million in Europe, 90
million in South America, 26 million in the Middle East oil regions and 52 million in
the African continent. . Due to the growth in the number of cars per capita, the potential
for increasing the global car fleet is about 1.4 billion units over the next 20 years.
The need to replace vehicles will also affect the growth of the car market.
According to the data for 2021, 17% of existing cars have approached the boundary
level in terms of technical and environmental pollution, 39% have already crossed this
threshold. In 5–7 years, the owners of another 25% of all existing cars will face the
need to replace. Another factor in the growth of the automotive industry in the next
decade is the need to replace the outdated fleet with internal combustion engines with
new and environmentally friendly vehicles.13
Figure 4 - Forecast of the total volume of car production until 204014
The forecast for total vehicle production through 2040 is about 3.63 billion units.
This is 2.5 times the current number of cars in the world and far exceeds the existing
production capacity. For this reason, in the past few years, the number of automakers
13
Догузов Г.Т. Анализ мирового рынка и производства легковых автомобилей в современных условиях // Московский
экономический журнал. 2021. №7..
14
Догузов Г.Т. Анализ мирового рынка и производства легковых автомобилей в современных условиях // Московский
экономический журнал. 2021. №7.
17
has been constantly replenished with new names, including NIO, Li Auto, Lynk & Co,
Rivian, Lucid. Technology companies far from the automotive business — Alibaba,
Xiaomi, Huawei and Apple — are starting to develop.
Figure 5 - Forecast of world sales of motor vehicles of all types, million units.15
The growth of the automotive sector will positively affect the growth of the
entire global economy. It also stimulates related industries - from aluminum, nonferrous metals and tires to infrastructure construction and the development of the
banking sector through the growth of car loans and leasing.
Around 2040, the global vehicle fleet may reach its peak. By this time, the main
cycle of replacing the car park with internal combustion engines with electrified
vehicles will be completed. With fewer moving parts, the average life of electric
vehicles could increase by up to 50%, so after 2040 the rate of replacement of obsolete
vehicles with new ones will decrease.
15
Догузов Г.Т. Анализ мирового рынка и производства легковых автомобилей в современных условиях // Московский
экономический журнал. 2021. №7.
18
3. AUTOMOTIVE INDUSTRY OF RUSSIA
3.1. The current state of the automotive industry of the Russian Federation
In 2020, Russian car factories produced a total of 1.43 million vehicles, which
is 17% less than a year earlier. In a more detailed review of the results of the last year,
the experts of the analytical agency "AUTOSTAT" noted that in the structure of car
production in our country, about half (47.2%) falls on only three enterprises:
AVTOVAZ, Hyundai Motor Manufacturing Rus and Avtotor.
The largest share in the Russian automotive industry belongs to AVTOVAZ
(21%). We can say that every fifth car in 2020 was produced in Togliatti. The share of
"Hyundai Motor Manufacturing Rus" (15.3%) accounts for approximately every
seventh car produced. Every ninth car in the country left the assembly line of Avtotor
(10.9%).
Figure 6 - The structure of the production of automotive vehicles in the Russian
Federation16
As for other automakers, there are four enterprises in the country with a share in
the range of 5-9%: Volkswagen Group Rus, GAZ, LADA Izhevsk and Renault Russia.
For Toyota Motor, this figure is 4.7%.
16
Статистика производства новых автомобилей в 2020 году https://auto.vercity.ru/statistics/production/2020/
19
The share of Nissan Manufacturing Rus, KAMAZ and UAZ is in the range from
2% to 3%, Mazda Sollers Manufacturing Rus is almost 2%. For the remaining
manufacturers, it is even less, and in total it is about 9%.
Figure 7 - Dynamics of car production in Russia from 2012 to 2020, pcs.17
As a result of the study, it was found that in 2020 the volume of production
decreased significantly, while the difference was 9.1%. If in 2019 this figure was
1,723,376, then in 2020 the decrease led to the level of 1,438,540. Including the
production of passenger cars decreased by 15.6%. In general, since 2012, production
volumes have been declining. Car production for the last year by months:
Figure 8 - Dynamics of car production in Russia over the past year, pcs.18
The new strategy for the development of the automotive industry until 2025 of
the country has become the first step towards the emergence of electric vehicles on the
Russian market. In 2017, 95 electric vehicles were sold. According to the forecast, by
2025 this figure should grow significantly and reach 85,000 - 100,000 vehicles.
17
18
Министерство транспорта Российской Федерации https://www.mintrans.ru/.
Статистика производства новых автомобилей в 2020 году https://auto.vercity.ru/statistics/production/2020/
20
Figure 9 - Strategy for the development of the electric vehicle market in
Russia, % of the world market19
As a result of the analysis, it becomes obvious that the main competition will
take place in the market for cars of the middle price category. The niche of premium
cars belongs to the world's largest brands and competition with them is inexpedient and
useless. Moreover, this will be hindered by the inability to acquire expensive
innovations due to the imposed sanctions. The main competitors are likely to be
Russian mid-range car manufacturers and emerging Chinese brands. In the face of such
fierce competition, it is advisable for Russian manufacturers to study the basic
preferences and needs of their consumers, and in some cases even deliberately manage
them in their favor. Everyone knows that recently the reputation of Russian
manufacturers leaves much to be desired, but with good support from the state and the
necessary efforts, it is possible to bring domestic production to the proper level and
restore a high image. In this case, automotive production in Russia will again become
a kind of catalyst for the economic development of our country.
Among other things, the Russian market for new cars, in comparison with other
states, did not suffer too much. As a result of the absence of serious “covid” restrictions
in the second half of last year, the Russian Federation ranked fourth in terms of sales
in Europe. However, one should not count on a quick recovery of the market.
19
Министерство транспорта Российской Федерации https://www.mintrans.ru/.
21
According to AEB forecasts, an increase in demand during 2021 will be approximately
2.1%, or about 1,632,000 new cars. At the same time, according to experts, the key
growth will take place in the second half of this year, when buyers will be able to get
used to the new prices, which are growing at the turn of the year more actively than
usual.20
3.2. The largest enterprises of the automotive industry of the Russian
Federation
Automobile plants in Russia form one of the most dynamically developing
branches of domestic engineering. The main task of the automotive industry is the
design and production of trackless vehicles using the energy of internal combustion
engines.
The technological basis of automobile factories is complete production lines for
the assembly and production of cars and trucks, passenger vehicles and motorcycles.
Automotive factories can also specialize in engine building (engine production), in the
production of individual components and parts for the entire automotive industry.
In terms of total output, the domestic automotive industry is one of the world's
leading industries.
In addition to the well-known Laga Granta, Vesta, Largus and XRay, the
following car models are produced at the largest factories in Russia:
– Hyundai plant in St. Petersburg – Hyundai Solaris and Creta, Kia Rio models;
- Nissan plant in St. Petersburg - Nissan X-Trail, Murano, Pathfinder and
Qashqai models;
- Toyota plant in St. Petersburg - Toyota RAV4 and Camry models;
– Avtotor in Kaliningrad – Kia cee'd, Sportage, Soul, Venga, Optima, Quoris,
Prime, Mohave, Cerato, Sorento models; Hyundai i40, Elantra; BMW X3, X4, X5, X6;
- Renault plant in Moscow - Renault Duster, Kaptur models; Nissan Terrano;
20
Статистика производства новых автомобилей в 2020 году https://auto.vercity.ru/statistics/production/2020/
22
– Volkswagen plant in Kaluga – Volkswagen Polo, Tiguan, Touareg, Multivan
models; Skoda Rapid; Audi A6, A8;
– Peugeot Citroen Mitsubishi Automotive plant in Kaluga – Mitsubishi
Outlander models; Peugeot 408; Citroen C4;
- GAZ in Nizhny Novgorod - Volkswagen Jetta models; Skoda Octavia and Yeti;
- AvtoVAZ in Tolyatti - Renault Logan, Sandero models; Nissan Almera;
- Ford-Sollers plant in Yelabuga - Ford Transit model (after Ford left the market,
only the LCV segment remained in Russia);
- Mazda Sollers Manufacturing Rus plant in Vladivostok - Mazda 6, CX-9 and
CX-5 models.
In addition, new plants are also opening - for example, a plant of the Chinese
company Haval has opened in the Tula region, which will produce cars with a high
degree of localization (up to body assembly and painting), and a Mercedes plant has
been launched near Moscow, which has begun production of E cars. -class.
There are not so many bus manufacturers - only 12 companies produced more
than 100 buses a year, and of these, 7 are Russian, 4 are Chinese and 1 is Belarusian:
– Pavlovsk Bus Plant is traditionally in the lead, in 2019 it produced 7864 buses;
- Likinsky bus plant - most of all produces 12-meter low-floor LiAZ-5292 and
articulated 18-meter LiAZ-6213. But there are in the assortment of the plant and cars
of the middle class - LiAZ-4292 and semi-low-floor LiAZ-5293;
- Neftekamsk plant - the main part of the output falls on the unified buses of a
large class NEFAZ-5299/5297, which can be produced in modifications for the city,
suburbs and even intercity;
- Kurgan Bus Plant - last year produced 419 buses, of which the elongated
KAVZ-4238 accounts for the most. Now the plant also offers a modern 10-meter city
bus KAVZ-6271;
- Volgabas - produced 395 buses in a year, most of which are 12-meter city buses
52701. At the same time, the plant regularly has problems associated with the owner
(and in 2020 also with components from China);
23
- Ural Automobile Plant - specializes in the production of shift buses on a truck
chassis;
- SIMAZ (Ulyanovsk) - produced 146 buses in a year, but these are small class
cars built in cooperation with Isuzu.
Even fewer companies produce urban electric transport. For example, there are
only 3 manufacturers of trolleybuses in Russia:
- Trans-Alpha from Vologda - there is one main model on the conveyor, this is
VMZ 5298.01 Avangard, which can be produced both with the possibility of
autonomous running and without it (but the battery pack occupies a significant part of
the cabin, reducing the capacity of the car);
- Transport systems - the company leases the capacity of the Trolza plant in
Engels and produces the PKTS-6281 Admiral model. This is also a trolleybus, which
can be produced in a modification with or without autonomous running;
- The Ufa tram and trolleybus plant is a production facility opened on the basis
of the Bashkir trolleybus plant that produces the UTTZ 6241.01 Citizen model, which
is built on the basis of the NefAZ body and can be autonomous (electric bus) or without
it (ordinary trolleybus).
That is, only 3 trolleybus models are mass-produced in Russia, while such
production cannot be called mass production - cities order less than 500 cars a year, so
factories simply start assembling for a specific contract. And taking into account the
fact that Moscow has completely abandoned trolleybuses, the market for them is
shrinking even more.
Trams are also produced by only 3 plants:
- Ust-Katav Carriage Works - in the assortment there are cars with 40% low
floor, with 70% and completely low floor (although the latter type is only one copy);
– Transport Systems – manufactures cars at leased sites in Tver and St.
Petersburg, manufactures Varyag, Vityaz, City Star, Lionok and Lev trams – among
them there are also three-section low-floor models;
- Uraltransmash is a plant in Yekaterinburg that produces trams along with tanks
and weapons. There are 4 models in the model range, there are completely low-floor
24
cars, there are cars with a low floor for 40%. The models are relatively new - 2 have
been produced since 2009-2011, and 2 since 2018.
Figure 8 - Production of trucks in the Russian Federation21
As you can see, GAZ, KamAZ and UAZ are in the lead, as well as Sollers (which
retained the production of Ford Transit). At the same time, Volvo, Scania trucks, and
lesser-known brands are also produced in Russia.
The lineup of the leaders is as follows:
- Kama Automobile Plant - most of all produced three-axle off-road trucks
KAMAZ-43118, dump trucks KAMAZ-65115 and main trucks KAMAZ-5490;
- Gorky Automobile Plant - about 2/3 of the total production fell on the "Gazon
NEXT" models, they also produced a lot of classic "Lawns";
- "URAL" - two-axle flatbed trucks "Ural-43206", "Ural-4320", "Ural-M" and
NEXT are in the lead in the structure of production.
At the same time, more than 28 thousand trucks of foreign brands were produced
in Russia last year, and most of all - 5240 - were produced at the Volvo plant in Kaluga.
21
Прогноз выпуска автомобилей в России на 2020-2021 годы. https://journal.ab-club.ru/news/prognoz-vypuska-avtomobilej-v-rossii-na2020-2021-gody/
25
The main part of the production of trucks is dismantled by business - Gazprom, Rosseti,
Rosneft, Iteko and others, but some of it is also exported.22
3.3. Features of the influence of the automotive industry on the economy of
the Russian Federation
An analysis of the actual results of the implementation of the previously adopted
“Strategy for the Development of the Automotive Industry of the Russian Federation
for the period up to 2020” indicates that a number of unresolved systemic problems of
the industry remain, including a low share of exports of automotive products and a
weak dynamics in the development of automotive component manufacturers. Based on
the results of the Strategy 2025, these problems are expected to be corrected by
increasing investment in the development of automotive production and the emergence
of long-term economic incentives for the development of component manufacturers
and the development of their own platforms. In addition, it is projected to increase the
scale of production of finished products to 2.56 million units by 2025 (including 2.22.5 million cars, 220-225 thousand light commercial vehicles, 110-125 thousand trucks
and 19-22 thousand buses) by developing exports and maintaining the attractiveness of
local production in the Russian Federation. However, the successful implementation
of this plan is in doubt due to the low competitiveness of the Russian automotive
industry in the world market.
Competitiveness in a market economy is an important condition for the
commercial success of the company and the engine for the development of
technological progress. Now, for a number of reasons, Russian cars are in many ways
inferior to their foreign competitors, despite the high customs duties on their products.
Russia is hopelessly behind in the field of auto production, and it will be possible to
overcome this gap only with the complete modernization of plants, which will require
huge financial investments [6].
22
Прогноз выпуска автомобилей в России на 2020-2021 годы. https://journal.ab-club.ru/news/prognoz-vypuska-avtomobilej-v-rossii-na2020-2021-gody/
26
The problems lie both in the technical side of the issue and in illiterate economic
planning. The first factor that plays a significant role is the fragility of the material
from which cars are made and its susceptibility to corrosion. Despite the fact that the
average price of a Russian car is lower than that of a foreign one, it does not justify
such a low quality product. This also includes the low qualification of workers, which
implies a large number of marriages.
In addition, now the whole world is worried about the problem of global ecology,
and all foreign brands are trying in various ways to reduce costs that have a negative
impact on nature to a minimum. For example, engines with certain European
environmental standards. In Russia, there are no restrictions on the operation of
vehicles with engines that do not meet European standards, and most trucks do not
have an environmental class. In 2018, a Government Decree was issued that introduces
a number of road signs, including the “Zone with the restriction of the environmental
class of motor vehicles”, and the information plate “Ecological class of the vehicle”.
However, all these changes are still only on paper, in fact, this paragraph of the traffic
rules began to operate only in 2021, but such control is imperfect,
Economic restrictions that do not allow the Russian auto industry to compete
with foreign ones are, first of all, the lack of incentives for Russian manufacturers. For
the effective functioning of the industry, significant reconstruction is necessary, which
requires huge investments, but does not guarantee a positive result. The price-quality
factor also plays a significant role here, since the difference in price between Russian
and foreign cars is not as high as the difference in quality. In 2017-2019, officials
launched a system of preferential lending and leasing of domestic cars, which slightly
increased demand, but with the termination of this program in May, sales decreased
again. Strategies to increase customs duties also do not give a significant result consumers still prefer foreign cars.
Thus, at present, the automotive industry has little impact on the country's
economy. The share of the industry in the country's GDP is less than 1%, while in
foreign countries this figure fluctuates around 10%. Despite the significant funding of
this industry, there are problems that require competent management decisions.
27
The main indicator that needs to be addressed is the increase in the
competitiveness of the Russian automotive industry both in the domestic and global
markets. In order to increase it, it is necessary to restructure literally the entire industry
- starting from the revision of the training program for automotive industry specialists
in Russian universities and ending with the improvement of technical standards for the
production of parts at factories. In addition, it is necessary to attract funds from private
investors in this industry and to establish a competent distribution of resources.
Demand support programs, primarily programs to develop the domestic gas engine
market and preferential leasing, need to be extended and optimized so that demand for
Russian cars rises and reaches record levels.
28
CONCLUSION
The world commodity market is the area of commodity-money relations between
states, which are based on the international division of labor. World commodity
markets are formed under the influence of many factors and have a number of features:
these are markets for already produced goods that are sold outside national borders;
these goods moving between countries are subject not only to internal, but also to
external supply and demand; these markets contribute to the most efficient use of
factors of production in certain industries and regions; thanks to them, goods that do
not meet quality standards at given competitive prices come out of international
commodity exchange. Each individual country occupies a certain place in the world
market of goods.
At the current stage of development of the capital market in Russia, the
adaptation of many foreign instruments for financing R&D in the automotive industry
seems either difficult to implement or economically inefficient due to excessively high
bank interest and cost of capital. Therefore, the problem of innovative development of
the automotive industry in Russia is much more complex systemic than it might seem
at first glance. In this regard, although the adaptation of successful foreign experience
seems to be the most rational method of development, however, the possibilities for
using most of the considered approaches are very limited by a wide range of economic
problems that cannot be solved in the short term.
The development of the domestic automobile industry in the conditions of an
innovative economy in the coming years will follow a unique scenario, different from
that typical of the leading capitalist economies. First of all, it will be based not on
market resources offered in flexible capital markets, but on the use of public funds, by
creating preferential conditions for the functioning of enterprises in the automotive
industry, as well as by accumulating and releasing the scientific potential of domestic
research personnel.
The main problems in the development of the automotive industry in the Russian
Federation are: high volatility and slowdown in the growth of the automotive market;
29
low competitiveness in the presence of a high level of competition in the automotive
market; a high level of fragmentation of the automotive market, as well as a low volume
of production of individual manufacturers; technological backwardness of the industry
in the absence of R&D incentives; personnel problem; problem with components; lack
of financial resources.
Ways to strengthen the positions of the Russian Federation in the world market
of the automotive industry should be to implement a number of activities such as:
attracting investment (mutual funds); using the industrial assembly mode; introduction
of nanotechnologies; formation of strategic alliances; creation of a new management
system for planning and marketing of public administration; ensuring centralized
control over the energy and transport industries, as well as regulation of tariffs;
establishment of control over compliance with the conditions of localization of
production; formation of favorable conditions for car loans and the creation of
incentive programs; subsidizing purchases of domestically produced cars.
Thus, thanks to the effective management of the process of attracting foreign
direct investment, the automotive industry will receive a new source of growth and
impetus for the development of the industry based on foreign technologies. And in
Russia, a new point of growth may appear on the basis of end-product industries.
30
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https://www.mintrans.ru/.
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https://journal.ab-club.ru/news/prognoz-vypuska-avtomobilej-v-rossii-na-2020-2021gody/
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Статистика
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https://auto.vercity.ru/statistics/production/2020/
32
автомобилей
в
2020
году