Page 82 - RusRPTSept20

some demand forward due to concerns about possible price increases. Still, we believe that the market environment remains fragile and continue to expect an 18% y/y decline for FY20F,” VTB Capital (VTBC) said in a note.
VTBC highlighted the listed carmaker Sollers that showed a 16% y/y increase in vehicle sales in July, while its 7M20 sales were down 18% y/y. Sollers was previously a joint venture with Ford, but the two parted company earlier this year.
“The performance of Sollers in July was driven primarily by Ford Transit sales (consolidated by Sollers), which increased 79% y/y to 1,703 units. YTD sales of the Ford Transit were also up 2% y/y to 6,135 units. We think that ecommerce-driven demand and government purchases have contributed to this performance,” said VTBC.
The Russian utilities van UAZ made by Sollers saw sales decline by 5% y/y to 2,619 units in July and 24% y/y to 14,903 units in 7M20.
“These trends are in line with our expectations that the Ford Transit will be the key driver before Sollers launches a new UAZ platform in late 2021. We continue to see Sollers' current valuation as undemanding, but the near-term triggers remain blurred,” said VTBC.
During the recession of the last few years Russians have traded down from foreign brands to domestic brands and the Lada, made by Avtovaz, has once again become the best selling car.
AvtoVAZ saw its sales increasing 6% y/y to 31,180 units in July, but falling 20% y/y to 163,776 units in 7M20. The company remains the market leader, with a share in excess of 20%, reports VTBC. The AvtoVAZ/Renault/Nissan/Mitsubishi alliance controls over a third of the market.
Among other Russian producers, GAZ's LCV sales declined 30% y/y to 3,592 units in July and 25% y/y to 23,440 units in 7mo20.
82 RUSSIA Country Report September 2020 www.intellinews.com