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Russian car dealers propose ban on state purchase of Western cars - report

11:05 12/08/2014

MOSCOW, August 12 (RAPSI) - Russian car dealers, in response to Western sanctions, are proposing a ban on state purchases of European and American car brands, even those assembled in Russia. As an alternative, Russian public officials could use South Korean, Chinese or Russian cars, Kommersant reports Tuesday.

On July 14, the Government banned the state and municipal purchase of foreign equipment and machinery although the ban did not include those assembled in Russia. Many foreign car makers, including Volkswagen, Toyota, Ford and BMW, already assemble their key models in Russia.

On August 7, Prime Minister Dmitry Medvedev announced that, if necessary, Russia is willing to introduce protective measures in the auto industry, and in aircraft manufacturing and shipbuilding.

Favorit Motors President Vladimir Popov confirmed that companies are discussing “the best response, which could be a total ban on state purchases of vehicles from the countries that imposed sanctions against Russia.”

Popov said that the “seemingly easiest option, to ban all vehicle imports or increase tariffs, would result in the state losing a substantial amount of direct and indirect tax revenue.” The restriction of state purchases, he believes, would reduce budget expenses and not affect the industry too much while individuals “should be allowed to buy whatever they want.”

“The state could purchase South Korean, Chinese or Russian car brands,” the dealer suggested. He estimates that “the measure would be quite efficient” because the share of Mercedes, BMW and Audis in corporate purchases is about 35%, with Toyota/Lexus not far behind the German brands.

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Russian car dealers propose ban on state purchase of Western cars - report

11:05 12/08/2014 Russian car dealers, in response to Western sanctions, are proposing a ban on state purchases of European and American car brands, even those assembled in Russia, Kommersant reports Tuesday.
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