Russia's 7% sales gain in July boosts optimism

Russia's new car and light commercial vehicle sales increased by 6.8 percent to 141,924 vehicles in July, data from the Association of European Businesses (AEB) showed, boosting optimism that a prolonged rebound is ahead.

"July is the first month this year with significant growth versus the previous year, which shows signs of the long-awaited recovery," Thomas Staertzel, chairman of the Moscow-based AEB's automobile manufacturers committee, said in a release.

Russian sales increased by 1.8 percent in both January and March before suffering double-digital percentage declines in April through June because of the lockdowns caused by the COVID-19 pandemic.

Among the brands to report sales gains in July were Lada, Hyundai, Skoda and Volkswagen, AEB figures show.

Lada rose 6 percent because of strong demand for the Granta and Vesta, Russia's No. 1- and No. 2-selling cars, respectively, in July and through seven months.

Hyundai was up 3 percent on brisk sales of the locally made Creta SUV.

Skoda jumped 69 percent in July because of the strong market debut of the new Rapid sedan. It entered as the country list of top 25 sellers at No. 6 for the month.

Staertzel said the gains in July were because of pent-up demand that was deferred during the lockdown as well as the the weakening ruble.

"The sales increase of some brands could be even higher without car stock deficiency linked to the production lockdowns during spring," Staertzel added.

Although Russia's seven-month sales decrease of 19 percent is ahead of the AEB's 2020 forecast for a 24 percent decline for the full year, the lobby group didn't adjust its prediction.

AutoVAZ's Lada was the top-selling brand in July with a volume of 31,180 vehicles.

It was followed by Kia, which was down 4 percent to 18,038 for the month, and Hyundai at No. 3 with a volume of 14,319.

Skoda ranked fourth with 12,329 sales while Renault rounded out the top five with 11,606 sales, a decrease of 1 percent from July 2019.