China takes a bigger hit than Russia

China takes a bigger hit than Russia

It seems that the Russian exit of a number of international companies has borne fruit for the Chinese companies that remained in the country.

China is taking an increasingly large share of the Russian auto market, after auto giants such as Volkswagen, Toyota, General Motors and Mercedes-Benz pulled out last year, according to Bloomberg.

Sweden’s Volvo also left Russia, but it is owned by China’s Geely, which Ukraine recently blacklisted for indirectly supporting Russian aggression in Ukraine.

Thrones on top

Chinese brands Chery, Haval and Geely were three of the top four best-selling auto brands in the first half of 2023.

Russian car brand Lada remains by far Russia’s best-selling car, with 143,618 vehicles sold, which is more than the three Chinese brands combined, according to data from the Confederation of European Businesses (AEB).

Geely more than doubled its sales volume in the country during the first quarter of 2023, compared to the same period last year. Geely Holding is owned by Chinese businessman Li Shufu, who is also Chairman of the Board of Directors of Volvo Cars.

Total auto sales rose 10 percent to 428,308 vehicles in the first half of the year, according to Bloomberg.

profitable industry

By 2022, international companies will generate more than $213.9 billion in revenue through their domestic operations in Russia, according to a report by the Kiev School of Economics (KSE).

Of this amount, profits amounted to $14.1 billion, for which they paid $3.5 billion in taxes to Russia. This corresponds to more than NOK 37 billion at today’s exchange rate.

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“This is only the tip of the iceberg and is likely to be an underestimate of the total tax bill,” the report said.

One of the industries that made the most money in Russia last year was the auto industry, as well as alcohol, tobacco and consumer goods.

Dalila Awolowo

Dalila Awolowo

"Explorer. Unapologetic entrepreneur. Alcohol fanatic. Certified writer. Wannabe tv evangelist. Twitter fanatic. Student. Web scholar. Travel buff."

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