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Ukraine Autos Report Q2 2008Published by: Business Monitor International Published: Apr. 18, 2008 - 46 Pages Table of Contents
AbstractUkraine’s car market exceeded all expectations in 2007, with new car sales rising by 46.1% year-on-year(y-o-y) to around 542,000 units, but BMI’s latest Ukraine Automotives Report forecasts a moderation in car sales growth in 2008 as the market approaches its potential and household consumption growth declines. AvtoVAZ led sales with a 21.7% market share, followed by Chevrolet on 9.3%. Chevrolet sales exceeded Daewoo sales, estimated at 9.0% of the total. The Ukrainian automotive industry also showed exceptional growth in both sales and output in 2007, according to figures published in early 2008. In 2007, Ukraine’s largest car manufacturer AvtoZAZ increased production by 46.2% to 282,310 units. With the Ukrainian economy forecast to grow at an annual average of 5.2% through to 2012, the car market is likely to remain buoyant, although a repeat of the growth seen in 2007 is unlikely. Household consumption is one of the key drivers of growth. We expect household consumption growth of 18.5% in 2007, which prompts us to forecast a moderation in car sales growth to a still impressive 35% in 2008. BMI forecasts that from 2009 car sales growth is likely to drop to around 8.0% per annum to reach 995,470 units in 2012. Meanwhile, the commercial vehicles market is set to grow in the region of 9-11% on average throughout the forecast period to reach 60,475 units by 2012, with the total automotive market reaching 1.06mn units, an increase of more than 80% over 2007 levels. Over the next five years, the Ukrainian car market will be influenced by three main factors: income growth, the exchange rate and loan rates. Any further appreciation of the euro to the US dollar will price European manufacturers out of the market, with Skoda already edging into the medium-price range on the local market. An appreciation of the euro could increase costs and put pressure on AvtoZAZ to raise prices, particularly if the Polish zloty is pegged to the euro, while a fall in the value of the euro could see Ukrainian-made cars losing price competitiveness on the EU market. Ukrainian production growth, therefore, depends on integration with the EU market and exchange-rate stability. Ukraine is set to join the World Trade Organisation (WTO) in 2008, a move that is set to have a major impact on the country’s car market. The trade arrangements could significantly boost Ukrainian automotive manufacturers’ exports, giving them an advantage over their Russian peers for the limited period in which Russia continues to negotiate its membership terms with the organisation. Improved access to export markets could also unlock greater volumes of private sector investments into the automotive sector, although the new trade arrangements will raise the price of Russian car imports which represent the largest section of the market. Get Full Details About This Report >> |
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