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Automobile industry

Japanese Automakers Rush to Expand Sales in Russia Amid Favorable Economy

Strategic Insights

— 2 min read

Japanese automakers are increasingly setting up sales companies in Russia, driven by the country's rapidly expanding auto market and favorable economic conditions. Nissan, Honda, Toyota, and Mitsubishi are among the companies establishing a presence in Russia to capitalize on the growing demand for foreign vehicles. The market is expected to reach 600,000 sales in 2005, with Japanese vehicles holding a 30% share of total foreign sales. Toyota was the top Japanese automaker in Russia in 2004, selling over 47,000 vehicles, while Mitsubishi increased sales by 70% in the same year.

Key Takeaways:

  • Nissan sold about 28,000 vehicles in Russia last year, a nearly threefold increase over the year before, and has created a parts distribution center in Moscow.
  • Foreign-built vehicles sold in Russia last year totaled some 400,000, up nearly twofold from the previous year.
  • Japanese vehicles have a reputation for high quality and hold a more than 30% share of total foreign vehicle sales in Russia.
  • Toyota was the top Japanese automaker in Russia with sales of about 47,000 vehicles last year, up 80% over the preceding year.
  • Mitsubishi's sales increased by 70% in 2004 over 2003 as it bids to catch up with Toyota.
  • Honda is lagging behind Toyota, Nissan, and Mitsubishi, with sales of less than 10,000 in 2004.
  • South Korean vehicles are a threat to Japanese automakers, with sales increasing much faster than those of their Japanese counterparts.
  • By entrusting auto production to local firms, South Korean companies are realizing lower prices and significantly increasing sales.

Statistics:

  • 28,000: Nissan's vehicle sales in Russia last year
  • 400,000: Total foreign vehicle sales in Russia last year
  • >30%: Share of Japanese vehicles in total foreign sales in Russia
  • 47,000: Toyota's vehicle sales in Russia last year
  • 80%: Increase in Toyota's sales over the preceding year
  • 70%: Increase in Mitsubishi's sales over 2003
  • 10,000: Honda's vehicle sales in 2004
  • 30%: Share of sales by small-size cars in total foreign car sales
  • 600,000: Expected total sales in the Russian auto market in 2005
  • 64: Number of business bases owned by Mitsubishi
  • 20: Number of outlets owned by Honda's local sales company
  • 2005: Year in which Honda aims to reach 50,000-vehicle sales

Sources:

  • Igor Malyalov, president of a company dealing in Nissan Motor Co. vehicles
  • Toru Saito, president of Nissan's local sales company
  • Kazuo Kato, president of Honda Motor Co.'s local sales company
  • An official at a Toyota sales company
  • Rolf official
  • Kyodo News International
  • Nissan Motor Co.
  • Honda Motor Co.
  • Toyota Motor Corp.
  • Mitsubishi Motors Corp.
  • Hyundai Motor Co.

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