MOSCOW (Reuters) -- Russian car sales fell 1 percent in November compared with 10 percent the month before as a state scrappage program and a rush to buy before expected price increases helped to slow falling registrations in the country’s troubled auto market.
The Association of European Businesses (AEB) lobby group said 229,439 new cars and light commercial vehicles were sold in Russia last month as Western sanctions over Ukraine continued to weaken the Russian economy.
To support automakers, Russia earmarked 10 billion rubles ($186 million) in September to fund incentives for new vehicle purchases until the end of this year.
Last week, the government extended the program into 2015 with a further 10 billion rubles. The scheme provides cash incentives for Russians to buy new cars if they sell old ones for scrap.
"Retail demand has been extraordinary in recent weeks, helped by government subsidies and consumers rushing to get ahead of widely anticipated new year price increases," Joerg Schreiber, chairman of the AEB Automobile Manufacturers Committee, said in a statement.
"The outlook on December sales is rather promising as well, raising the prospect of a decent closing of a difficult year for the Russian car market," he said.
In the first 11 months, sales were down 12 percent at 2.22 million, in line with AEB's forecast for a 12 percent sales drop in 2014 as a whole.