Why is Russia the place to be right now for carmakers?

Jeff Horwich Aug 30, 2012
HTML EMBED:
COPY

Why is Russia the place to be right now for carmakers?

Jeff Horwich Aug 30, 2012
HTML EMBED:
COPY

The Moscow International Auto show is about to open. And ahead of it General Motors has announced a $1 billion investment over the next five years, building cars in Russia. GM is already expanding its plant in St. Petersburg. Volkswagen also announced another billion plus dollars into building its manufacturing and market share in Russia.

Sir. Nick Scheele was, until 2005, the president of Ford, after a long career in the European auto industry. He’s now retired, and talking to us from Birmingham, England. He says Ford was the first foreign car manufacturer to build cars in Russia, which happened at the start of the 2000s, followed by GM and others.

Russia is the place to be right now, he says. “Of all the European markets, it is the fastest growing. It will shortly be the largest European market. Last year, Russian car sales were roughly some 2.5 million. Forecasts in the next year are about 3 million and to overtake Germany in the next two years.”

Interestingly, in Russia, when gas prices go up, so do car sales.

Hear more details in the audio above.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.