Automotive Logistics Russia

The Automotive Logistics Russia 2009 conference has taken place

Automotive Logistics Russia was held for the third time from June 22 to 24 2009 at the Hotel Radisson SAS Slavyanskaya, Moscow, Russia

Key senior automotive logistics executives gathered to debate the key issues facing the Russian logistics arena, exploring solutions to overcome the obstacles often found within the industry, with an emphasis on promoting networking and collaboration.

Many delegates have testified that they found the Automotive Logistics Russia conference beneficial, interesting and enjoyable.

We are still confirming dates and venues for next year and will make a decision soon after carefully evaluating the feedback from this year's conference.

In the meantime, if you would like us to keep you updated about our conferences, please click here.

2009 Conference report

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Automotive Logistics Russia 2009: coping with the Russian bear By Christopher Ludwig

The Automotive Logistics Russia conference 2009 in Moscow revealed a market reeling from its first major decline in new vehicle sales for nine years, with sales drops of more than 50% in many segments.

But while the logistics landscape has also changed drastically, with the once pressing issues like the lack of transport capacity or port space now turned upside down, carmakers, LSPs and dealers emphasised that the role of logistics has become even more vital in safeguarding precious cashflow. Delivering vehicles and spare parts more quickly has also become even more important to carmakers; where only last year customers were willing to wait up to year for a car to be delivered, consumers now expect their cars or repairs immediately.

The decline in Russia has been more dramatic than in most markets: May sales dropped by 58%, and for the year are down 50%. While sales of cars and trucks reached 3.6m in 2008, even the Association of Russian Automaker's (OAR) relatively optimistic forecast for this year predicts sales of only 1.9m. PriceWaterhouseCooper, Rolf Group and VW are gloomier, anticipating sales between 1.4m-1.45m.

The figures most relevant to finished vehicle logistics providers look even worse: the import of new cars and trucks in April dropped from 206,000 during that month in 2008, to 74,000 this year, with truck imports almost disappearing following a nearly tenfold decline according to Vladislav Zaslavskij, President of the Association of Car Importers and Customs Brokers (ACICB). OAR predicts that truck sales in the domestic Russian market will fall from 404,000 last year to 150,000 this year, while bus sales - aided by the government renewing fleets in certain regions - is expected fall less, from 65,000 to 45,000 units. The ACICB projects that imports of cars and trucks this year will not exceed 800,000, down from 2.2m last year.

Local production, which reached 1.3m vehicles in 2008, and had been projected to rise to 3m by 2012, has also been significantly cut this year.

The economic factors hurting Russia have been well documented, as the wider economy has suffered the impact of the credit crunch, global downturn and the collapse in the price of oil, Russia's primary source of wealth. As 40% of new car purchases in Russia last year were by loans, the market has been hit by the scarcity of credit, according to Maria Gontar, Leading Specialist for OAR. The devaluation of the rouble, as well as an increase in customs duties, has also led to price increases.

Positioning now for the future

But while the numbers and current economic indicators are discouraging, most of the representatives at the conference were upbeat about the future prospects of Russia. Gontar said that in the longer term, Russia's car industry's "is one of the most promising in the world."

In view of this, despite declining sales, several carmakers are still pushing forward with expansion plans. The Volkswagen Group has increased its market share substantially this year, with the core VW brand up 15% in the first five months of the year (18,175 units). Skoda and Audi outperformed others with declines of 12% and 14%, respectively. According to Jan Bures, Head of Group Service Division for VW Rus, the German OEM will increase its dealer network in Russia from 182 to 348 by 2012.

VW, along with PSA, Mitsubishi and Volvo Trucks, will also continue to develop production in the Kaluga region, south of Moscow. According to Maxim A. Akimov, Deputy Governor of the Kaluga Region, of the 42 projects and O3 billion worth of committed projects in the region, only two had so far been postponed or cancelled. Meanwhile, the region is continuing to develop new roads and rail links, along with three industrial parks that will serve the automotive plants as well as their suppliers as they continue to localise.

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