MOSCOW -- Russia's new-car sales are expected to fall 2.2 percent to 1.76 million units, the Association of European Businesses (AEB) said.
The AEB had originally forecast demand to rise to 1.87 million this year from 1.80 million units in 2018 but said in July that "market growth in the full year of 2019 is not a realistic scenario anymore."
The industry association predicts that another rise in the country's utilization fee could suppress demand in the market. The tax is designed to account for recycling charges at the end of a vehicle's life.
From 2014, automakers have had to pay the utilization fee both for vehicles assembled in Russia and those imported to the country, but on locally-made vehicles the government reimburses the fee.
"The uncertain element here is the possibility of another significant increase of the utilization fee in 2020 as reportedly being discussed by the government," Schreiber said, referring to the new 2019 sales forecast.
"Should such a decision be adopted, it would add another question mark over the long-term prospects of the Russian car market as a whole," he said. "Short-term, however, sales of imported cars might receive an artificial boost -- of course at the cost of sales in the following period."
Sales of new cars in Russia fell 0.2 percent year-on-year in September to 157,129 units, which is "not a bad result looking at the negative track record in recent months," the AEB said.
