According to media reports, Maxim Sokolov, CEO of Russia's largest automaker Avtovaz, stated that Russian passenger car sales are projected to decline by 25% in 2025, falling to 1.1 million units.
In comparison, Russia sold 1.55 million passenger vehicles last year, marking a 47% year-on-year increase.
Initially, market analysts had predicted only a 10% decline in Russia's 2025 car sales, citing inflation and rising vehicle scrappage costs as the main contributing factors.
However, Sokolov now warns, "The current situation is severe, and the market is clearly on a downward trend. The overall passenger car market this year will shrink by about a quarter compared to last year." He noted that while around 500,000 new vehicles are ready for sale, it has been extremely difficult to find buyers.
Russian auto dealers report that macroeconomic uncertainty is dampening consumer demand. Potential buyers are opting to save their money or convert it into U.S. dollars, anticipating a widely expected depreciation of the ruble.
According to data from market research firm Autostat, from January to May 2025, sales of new passenger cars in Russia dropped by 26% to 440,259 units. Avtovaz's own sales declined by 24.2% to 131,316 vehicles during the same period.
Autostat also reported that passenger car inventory in Russia has now exceeded 500,000 units. The firm's head, Sergei Tselikov, stated that dealers across Russia are increasingly relying on deep discounts to attract buyers.
Furthermore, the Russian business daily Vedomosti reported that electric vehicle (EV) sales in Russia plummeted to one-third of the volume sold in the same period last year during the first five months of 2025, compounding challenges for the domestic auto industry.
Sokolov commented, "The situation is critical. With such intense market volatility, it's impossible to maintain normal operations on the production lines."
Avtovaz is taking steps to mitigate the crisis by revising its 2025 production plans. The company now expects its total sales to drop by 20% to 25%, to around 367,200 units.
Following the outbreak of the Russia-Ukraine conflict in February 2022, Western automakers swiftly ceased vehicle production and sales in Russia, causing a steep collapse in the local auto market. Although Chinese carmakers rapidly filled the void and spurred a temporary recovery, the latest figures indicate that Russia's auto industry is once again on a downward trajectory in 2025.
