Japan’s used-car exports have cooled as sanctions and policy moves restricted shipments to Russia. Market observers note that without Japan’s interruption of supply to the Russian Federation, the sales volume could have surpassed the $1.9 billion mark by late 2023. The sanctions have also driven a dip in second-hand car prices within Japan, prompting dealers to explore other regions and redirect shipments to right-hand-drive markets such as New Zealand, parts of Southeast Asia, and some African countries. Reuters reports this shift in strategy and the resulting market dynamics.
SV Alliance, a dealer focused on exporting cars from Japan to Russia, has reduced its workforce due to a roughly 70 percent drop in business volume. The downturn mirrors a broader pause in trade flows caused by the sanctions and the relocation of demand to alternative markets. Reuters notes the impact on employment and the broader supply chain as firms adjust to a changed export landscape.
Following the withdrawal of automobile manufacturers from Russia in 2022, demand for Japanese second-hand cars recovered in certain segments. By the end of the previous year, Russia accounted for about a quarter of Japan’s second-hand car exports, up from 15 percent in 2020, illustrating a rebalancing of trade partners as sanctions reshaped routes to market. Reuters highlights this shift as a key indicator of how sanctions have redirected demand over time.
Data from Japan’s Ministry of Finance show a rebound in passenger car exports to Russia during the first half of the year, rising 32.8 percent compared with the same period in 2022. Exports in June also rose sharply, up 60.3 percent from June of the prior year. A policy change banning the export to Russia of cars and hybrid vehicles with engines larger than 1.9 liters is slated to take effect on August 9 in Japan, a measure that is expected to influence future trade flows and the availability of certain vehicle types for the Russian market. Reuters provides the context for these regulatory developments and their potential effects on trade volumes.
In a broader view, analysts note that the evolving sanctions regime and Japan’s export controls are reshaping the used-car market not only in Russia but across adjacent regions. Car dealers in Japan are increasingly considering diversification of export routes, while buyers in Russia and neighboring markets adjust to the new accessibility of Japanese imports. Taken together, the data suggest a confluence of policy, market pricing, and demand shifts that will influence the used-car landscape in the coming months. Reuters contributes to this analysis by threading together policy actions, price movements, and sourcing strategies across regions.
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