Russia’s Automotive Market in 2023: Structural Transformation

This report summarizes a comprehensive study of Russia’s automotive market conducted by the international automotive service network FIT SERVICE in cooperation with the analytics firm Gruzdev-Analyze.

The study covers the first nine months of 2023 and was presented at an online industry conference

The analysis focuses on:

  • new and used vehicle sales,
  • changes in vehicle ownership behavior,
  • contraction and aging of the active vehicle fleet,
  • brand structure of the fleet,
  • medium-term prospects for Chinese brands and electric vehicles (EVs).

Key Market Trends (Executive Summary)

According to the study:

  • the used car market reached record volumes,
  • the average vehicle ownership period declined sharply,
  • the active vehicle fleet continues to shrink while aging rapidly,
  • Chinese brands and electric vehicles have limited short- and medium-term impact on the overall fleet structure.

New Vehicle Sales in Russia

New vehicle: a vehicle registered for the first time in the country.

Key findings:

  • New car sales increased steadily throughout 2023.
  • Since May, and especially from July onward, monthly sales stabilized at 98,000–109,000 units.
  • Sales volumes remain below pre-pandemic 2019 levels but are close to those recorded in 2021.
  • August and September results indicate an active phase of market recovery.

Role of Parallel Imports

Parallel import: the import of vehicles without the involvement of an official brand distributor.

  • Parallel imports account for approximately 13% of all new vehicle registrations.
  • The majority of new vehicles are either produced domestically or imported through direct supply channels.

Used Car Market: Record Growth

Used car (pre-owned vehicle): a vehicle that has previously been registered and operated.

Market indicators:

  • Over 5 million used vehicles were sold in Russia during the first nine months of 2023.
  • Year-on-year growth reached 27%.
  • Total vehicle sales (new + used) are forecast to reach 7.5 million units by year-end.

Increasing Role of Dealers

  • Many automotive dealers have shifted their business models toward used vehicles.
  • This strategic reorientation has helped dealer groups maintain financial stability amid constrained new vehicle supply.

Declining Vehicle Ownership Period

Vehicle ownership period: the average time a vehicle remains with one owner before resale.

Key data:

  • Average ownership period in 2023: 4.6 years.
  • Previous year (2022): 5.7 years.
  • Annual decline: 19%, reaching a historical low.

Drivers of change:

  • record levels of vehicle resales,
  • increased interregional vehicle movement,
  • growing demand for pre-purchase vehicle inspections.

Active Vehicle Fleet: Contraction and Aging

Active vehicle fleet: vehicles currently in operation.

Fleet dynamics:

  • 2022: −822,000 vehicles (−2.3%)
  • 2023: −395,000 vehicles (−1.1%)
  • Estimated fleet size by end of 2023: approximately 34.3 million vehicles

Fleet Aging

  • Average fleet age in 2023: 11.2 years (up from 10.9 years in 2022).
  • Average vehicle age serviced within the FIT SERVICE network: 12.4 years.
  • Rapid aging increases demand for maintenance and repair services.

Vehicle Service Life Is Increasing

Active service life: the total period a vehicle remains operational before final retirement.

  • Average service life in 2023: 27 years.
  • Stable at ~24 years during 2019–2021.
  • Growth since 2022 reflects slower vehicle retirement.

Customer structure:

  • Share of owners of vehicles older than 20 years:
  • 2019: 9%
  • 2023 (9 months): 14%

Consumer behavior indicates increased cost sensitivity and a stronger focus on extending vehicle lifespan.

Chinese Brands and Electric Vehicles: Market Reality

Chinese Automotive Brands

  • Share of Chinese brands in Russia’s total vehicle fleet: ~2%.
  • Share among FIT SERVICE customers: 2.5%.
  • Even at current sales rates, significant fleet penetration will require many years.

Brand structure:

  • Russian brands dominate the fleet.
  • Japanese brands remain the largest foreign group with ~40.5% share.

Service characteristics:

  • Typical service intervals for Chinese vehicles: 10,000–15,000 km.
  • Expected to generate higher service visit frequency within 2–3 years of ownership.
  • Average dealer loyalty period: 1 year 10 months.
  • By the third year of ownership, 86% of service visits occur at independent workshops.

Electric Vehicles (EVs)

Electric vehicle (EV): a vehicle powered fully by electric motors.

  • EVs account for less than 1% of Russia’s vehicle fleet.
  • No significant increase in EV sales share is expected over the next three years.
  • Large-scale demand for EV servicing remains a long-term prospect.

Overall Conclusions

  • The Russian automotive market in 2023 is driven primarily by used vehicle transactions.
  • Ownership periods are shortening despite longer vehicle service life.
  • The active fleet continues to shrink and age, boosting demand for repair services.
  • Chinese brands and EVs will not structurally reshape the fleet in the near term.
  • Independent service networks are gaining importance as vehicles age and dealer loyalty declines.

About Gruzdev-Analyze

Gruzdev-Analyze is an international marketing and analytics company with over 20 years of research experience, including 15+ years in the automotive sector. Its clients include global automakers, component manufacturers, service networks, and IT companies.