Mass closures hit Russian car dealerships

Russia's automotive market crisis has hit car dealerships hard. Between the start of the year and 1 September, the total number of sales outlets and showrooms across the country fell by 9%, dropping to 7,284.

Source: The Moscow Times, as reported by Ekinomichna Pravda

Details: Closures have been even sharper in Russia's major cities. 

Rostov-on-Don saw the steepest decline, with 29.3% of outlets shutting, leaving just 94 points of sale. Voronezh followed with an 18.8% drop to 65, while Volgograd and Samara saw falls of 18.3% (58 outlets) and 18.2% (117 outlets) respectively. Krasnoyarsk recorded a 17.2% reduction, leaving 96 dealerships.

Russia's largest markets also contracted: Moscow lost 11.1% of dealerships, leaving 706, and St Petersburg saw a drop of 17.6%, down to 365 dealerships.

The decline is far from over, with around a third of dealers reportedly facing severe financial difficulties or teetering on the brink of closure, said Aleksey Podshchekoldin, president of the Russian Automobile Dealers Association.

According to Podshchekoldin, low demand for new cars is driving losses and squeezing profits, which in turn pushes up costs for sellers.

Quote: "Regional dealerships in Russia are now selling just 220-250 cars a year, while in the capital the figure is around 400. By comparison, dealerships in the United States sell roughly 1,000 vehicles annually. At such low levels, many Russian dealers become unprofitable, leading to widespread closures".

Background: Mass production of the new Lada Iskra sedan is not expected to begin before March-April 2026. AvtoVAZ was unable to launch full-scale production in 2025.

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