Russia raised the tariffs for the import of domestically manufactured vehicles
In a significant move to protect Russia's domestic auto industry, the government has closed a loophole that allowed the re-importation of used cars originally produced in Russia but exported to Eurasian Economic Union (EAEU) countries with lower recycling fees. This change has increased costs and made such imports less economically attractive.
According to Anton Shaparin, vice-president of the National Automobile Union, this loophole was mainly exploited through Belarus. The statistics do not include data on cars assembled in Russian factories or on the import of used cars of domestic production.
The closure of the loophole has had a notable impact on the importation of used cars to Russia, particularly those from EAEU countries. Previously, re-imported cars were exempt from recycling fees, but with the change, they are now subject to the same fees as imported vehicles.
The list of cars affected by the new tariffs is extensive, including brands like BMW of Kaliningrad assembly, Mercedes of Moscow assembly, Nissan or Toyota of St. Petersburg assembly, or Volkswagen or Skoda of Kaluga assembly. However, cars that meet specific conditions, such as being registered to the person who paid the duty and not changing ownership within 12 months of its initial registration with the traffic police, are exempt from the new tariffs.
The new tariffs do not apply to cars assembled abroad that are not Russian-made, ensuring that the old rules still apply for them. The impact of these changes on the structure of the secondary market, where over 6 million cars are sold annually, is unclear.
The commercial scrap collection rates for engines are as follows: less than 1 liter - 180,200 rubles, 1-2 liters - 667,400 rubles, 2-3 liters - 1,875,400 rubles, 3-3.5 liters - 2,153,400 rubles, 3.5 liters and above - 2,742,200 rubles, electric and hybrid vehicles - 674,000 rubles.
The import of new passenger cars to Russia has decreased by 63% in the first six months of the year, with 149,3 thousand cars imported. Meanwhile, it's now more expensive to buy cars in Belarus and bring them to Russia for these brands, as it's cheaper to buy their European or Japanese counterparts. The secondary market in Russia, where over 6 million cars are sold annually, is not affected by this change.
The new recycling fee policy is part of Russia’s broader efforts to curb market distortions caused by re-imports, promote local production, and ensure that all vehicles entering the Russian market contribute to environmental recycling obligations equally, regardless of their origin or the route they took to enter Russia.
The new recycling fee policy, aiming to curb market distortions, is also targeting the industry of automobile production in Russia by promoting local production. This change in finance regulations has made the importation of used cars from EAEU countries less attractive, potentially impacting the business dealing within the secondary market.
The closure of the loophole for re-imported used cars has resulted in these vehicles now being subject to the same recycling fees as imported ones, increasing costs for the industry of finance and affecting the business of importing such cars in Russia.
