At the close of 2023, car prices across the industry were effectively frozen, with expectations of a price uptick on the horizon as manufacturers prepared for the new year. The head of the Avtodom dealer group, Andrei Olkhovsky, shared these insights during a discussion with socialbites.ca, outlining the industry-wide sentiment and the underlying market dynamics that would shape pricing as 2024 arrived. He explained that the recent macro shifts, including the rise in interest rates and fluctuations in the ruble, had created a climate where buyers hoped for more affordable purchases. Yet the reality of retail pricing was unlikely to swing dramatically downward, given the historical patterns in the Russian auto market, where a steep drop in prices has not been the norm in recent years. He stressed that most brands were contemplating a price rise once the calendar flipped to 2024, but producers preferred to coordinate increases rather than act alone. The strategic logic, according to Olkhovsky, was to wait for the new year as a natural moment to balance exchange-rate movements and preserve value across the supply chain. This collective approach to pricing signals a broader shift in how automakers manage currency risk and component costs in a volatile market environment, with implications for consumers and retailers alike. (Source: Avtodom leadership communications)
The executive also highlighted the intimate link between the primary market for new cars and the secondary market for used vehicles. When new-car prices rise, used-car values tend to follow suit, particularly for models aged one to three years that feature desirable configurations and reliable spare parts availability. In practice this means that popular, well-equipped vehicles with easy access to parts tend to see quicker appreciation in price on the used-car market. Olkhovsky argued that buyers aiming for good value should keep an eye on these high-demand, low-friction options, since their price trajectory often leads the way in the broader resale ecosystem. This interdependence solidifies the idea that a shift in new-car pricing cascades downward, affecting consumer choices and financing decisions in the secondary market. (Source: Avtodom leadership communications)
Looking ahead to 2024, Olkhovsky projected a solid expansion of the new-car market, with potential growth around twenty percent that could push total sales into the 1.3 to 1.4 million vehicle range. He attributed the anticipated uplift largely to rising sales of Chinese-brand models, noting that Russia had become the top importer of Chinese-built cars and that its share of imports had surged dramatically in recent years. Specifically, imports from China rose from a modest portion in 2021 to a dominant position shortly thereafter, signaling a shift in the competitive landscape. If Chinese exporters continue to gain share at the current pace, there could be new dynamics in play for 2024, including potential oversupply or intensified competition as multiple brands vie for a larger slice of the market. (Source: Avtodom leadership communications)
In addition to these macro trends, Olkhovsky reflected on the historical context of supply and demand within Russia’s automotive sector. The narrative of Chinese-brand momentum, currency movements, and the interplay between primary and secondary markets remains central to pricing and consumer strategy. The industry is watching for how the balance between cost pressures, financing terms, and consumer sentiment will shape outcomes in the year ahead. The most immediate takeaway is that price stability for some segments may be short-lived as manufacturers recalibrate their strategies in response to shifting macroeconomic cues. The evolution of the market will likely continue to hinge on how quickly exchange-rate normalization and tariff and logistics conditions align with consumer purchasing power. (Source: Avtodom leadership communications)