New car sales in Russia fell again sharply in May due to Western sanctions against the country. The sanctions have hit the Russian economy hard and consumers have become much more cautious about large spending.

 

Also, many foreign car manufacturers have stopped selling in Russia because of the war in Ukraine.

According to the Association of European Business in Russia, sales plummeted by 83.5 percent from a year earlier, to just over 24,000 new passenger cars and vans. This means that sales have fallen to the lowest level since 2006. In April sales already fell 78.5 percent.

Sales of the popular Russian brand Lada, for example, fell by 84 percent. The French Renault has now sold its stake in the company AvtoVaz, which makes the Lada, to the Russian government. In addition, companies such as Mercedes-Benz, Volkswagen and Toyota have stopped production in Russia as a boycott over the invasion of Ukraine.

Russian car manufacturers are also struggling with shortages of parts imported from abroad. To deal with this problem, the Russian authorities previously decided to weaken certain standards on safety and emissions. For example, locally built cars no longer need to be equipped with airbags.