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MOSCOW, April 8. The expert council under the Committee on Industry and Trade of the State Duma of the Russian Federation predicts a reduction in production by domestic automakers by up to 50% against the backdrop of falling demand caused by Chinese expansion, AvtoVAZ said in a statement.
According to experts, this is exactly the scenario the industry expects if current trends continue; government support is needed. In particular, increasing the recycling fee.
“According to experts, if current trends continue, domestic automakers will be forced to reduce production by up to 50% due to the forced transition to a single-shift operating mode (instead of two shifts), caused by a drop in demand in their price segments, where, due to large-scale discounts, imported Chinese cars will be presented.” , — noted following the meeting held by AvtoVAZ President Maxim Sokolov.
The message also notes that in such a situation, Russian companies will be forced to produce only low-tech outdated products and will not be able to finance R&D (research and development work) and the development of their capacities, create new high-tech jobs. All this will negatively affect the achievement of technological sovereignty and industrial growth.
«An initiative has been put forward to systematically increase the recycling fee, which should stimulate investment by foreign companies in the creation and development of local production. The expert community, as part of the discussion at the Council, proposed to establish a gradually increasing scale of recycling fee for passenger cars, commercial and trucks, agricultural, construction and road equipment, buses, as well as electric vehicles,” the message says.
In the near future, detailed proposals of the Expert Council will be sent to the Committee on Industry and Trade of the State Duma and to the authorized executive authorities.
“We are in favor of having more localized auto production in Russia, both under national and foreign brands. And let them bring to the market a wide selection of models and compete with each other for the attention of domestic buyers. Thanks to increased market protection, the import of finished cars «must be replaced by investments in their production in the country. Local production in Russia will increase — there will be more orders from the component industry, new technologies and jobs will appear, the cost of components will decrease, prices for new cars will go down, the market will grow,» Sokolov emphasized.
Last week, Deputy Prime Minister and Head of the Ministry of Industry and Trade Denis Manturov noted that the ministry is ready to study the possibility of increasing the recycling fee for cars if industry representatives form a unified position and specific proposals on this issue.
Since August 2023, according to government decree, the recycling fee rate for passenger cars has been indexed by an average of 1.7-3.7 times, for light commercial vehicles — by 2.5-3.4 times, for trucks — 1.7 times, for buses — 2.2-4.8 times and for electric buses — 8.7 times. Automobile concerns with highly localized production in the Russian Federation and a special investment contract are entitled to industrial subsidies. In the industry they are generally considered compensation for waste collection.