Sanctions vs Russia’s car market. Who wins?

[Music] so how soon will Russian roads look like this one of the most frequent requests I received on my channel over the last year has been to make a video on the Russian car market as some people believe this is where Western sanctions have hit the hardest well let's find out armed with my wife and my not so hidden camera we went to the biggest car dealership in Moscow as undercover Shoppers the price tag for it is a whopping it's around 38 000 hits believe me what these unsuspecting dealership employees told me was a far cry from the sugar-coated narrative spun in both the Russian and Western media I also interviewed one of my subscribers who just bought a new Chinese crossover to replace his wrecked Mercedes something that many Russians might be forced to do given how fast Chinese cars are making in rows in the Russian markets and of course I couldn't pass up the chance to get inside a new Russian car released in 2023 that looks strikingly similar to a mid-range Chinese crossover we're really you know uh grinds my gears is the fact that it costs an arm and a lack to get this car here compared to its price back in China buckle up for the unfiltered truth on real reporter oh all right I think it's time for you to meet my car a 2012 Opel Astra that has certainly seen better days thank you [Music] know I got this car when we had a kid and a lot of memories associated with this old beater however the issue of buying a new vehicle has been a long time coming and I remember that I first thought that it's time to upgrade in 2020 but the pandemic for a wrench and car production and prices went through the roof and I thought well all right you know I'll wait this one out big mistake because prices have been skyrocketing ever since and now with sanctions and everything getting a decent car for a reasonable price in Russia it's like searching for a needle in a haystack in 2022 only 690 000 new cars found owners in Russia marking a dramatic 60 plunge from the previous year this has made 2022 the most catastrophic year in the modern history of the Russian Auto industry this is Boston Street in Moscow looks like during the day now I mean it's a stretch to say that uh moscow's roads look different from what they did a year ago when sanctions were imposed when cruising around it doesn't feel like there are fewer cars and to be honest with you traffic is still a mad house however the types of cars on the roads have begun to change out of the 60 car brands that were officially represented in Russia before the war in sanctions only 14 remained standing and guess what among these 14 survivors 11 are from China when it comes to new officially sold Vehicles the Russian Market is now 78 Chinese I remember when Chinese cars was this casual term people used without specifying Brands you would say my friend got a Chinese car as opposed to my friend got a BMW or Mercedes or Chevy no one really knew how to pronounce the names of Chinese cars as a gilly or Jilly is in haval haval however things are changing now in Russia and people are starting to get a handle on various Chinese car brands and are no longer painting them all with the same brush the car dealership we've come to is one of the oldest in Moscow it used to specialize in selling high-end Western Brands but judging by the signs outside it looks like their business strategies shifting gears inside though we were in for a surprise [Applause] despite the sanctions and big talk about new Western cars being unavailable in Russia this place boasts shiny new BMWs and Sleek Mercedes all the vehicles are labeled used bought as a spiff top salesman told us this is Justin facade foreign dropped even further when we looked at the price tags a 2023 BMW X7 goes for over 20 million Rubles around 265 thousand dollars a new Mercedes-Benz S350 goes for around 17 million Robles or two hundred and ten thousand dollars ouch let me know how much these high-end models might cost in your country foreign look elsewhere we were politely advised to check out the used car section and were overwhelmed by the selection here you have everything from one of the male dad cars to a flashy 2015 Dodge Challenger and this red 2005 Ferrari and if you think no one buys these cars I literally saw a guy driving off the dealership lot in the gleaming sports car that he just purchased in our price range however there wasn't much to choose from let's take for instance this uh 2019 uh skoda with over 90 nurse on it price tag for it is a whopping three million Rubles which is around thirty eight thousand dollars [Music] so I gathered up my courage and walked straight into the sales team Sten revealing my bald plan trading my old opal for a solid 500 000 rubles six thousand two hundred dollars and top it off with another million and a half or eighteen thousand five hundred dollars out of my pocket truth be told I don't have that kind of money but from what I gather 10 million Rubles or twenty five thousand dollars is the bare minimum for something better than my old opal these days surprisingly the salesperson didn't seem particularly impressed with this amount and instead of showing us a myriad of options simply directed us to a computer where we could handle the task ourselves [Music] right our choices were meager we discovered a relatively new but well-worn Renault a low mileage but pricey Carrio and an 11 year old BMW yeah we were about a bail and go check out the Chinese brands of the next section but then we saw this [Music] 2018 Jaguar with 78 000 kilometers on it that would only cost me 18 500 plus my old car a jaguar ah I mean it looks fancy all leather yeah you know I don't know maybe it's a trap or something because I didn't expect that a Jaguar would cost significantly less than say a BMW or a Mercedes I always thought you know these are high-end brands that you know should cost a lot so honey do you like jaguar this car doesn't come cheap of course but in the grand scheme of things this doesn't seem like a bad deal at all unless there is something they're not telling me there's been many reports about Western car parts being very expensive or a hard to get ever since sanctions hit this very well might be the case for Jaguar which has always been a niche brand in Russia at this dealership however I was told that there is absolutely nothing to worry about it foreign the issue of spare parts is yet another example of how everything might be twisted in the media if you read Western sources you'll be told that there are no spare parts in Russia period if you read Russian sources you'll be told that almost everything has been sorted out through parallel or great Imports so where does the truth lie I actually have a personal experience to share something was off with my brakes a few months ago and I had to stop at a random repair shop run by friendly Georgian guy who happened to be a big Stalin fan amidst this unique setting he identified the issue in no time so I'm gonna need new brake pads these ones are done I went to random auto parts store fearing I'd either have to pay a small fortune for new brake pads or leave empty-handed my surprise none of those worries were Justified as they gave me a set of brand new Belgian brake pads or maybe they were in Belgian but they worked just fine I got my new brake pads for fifty dollars and then the work cost me 65 US dollars so all together it came to 110 115 dollars I actually thought the work would cost uh it would be cheaper anyway let me know how much you would pay for something like this uh in your country the truth lies somewhere in between I suppose spare parts have certainly risen in price but it's not like sanctions have caused total karmageddon on Russian roads besides Western car dealers haven't entirely left the country and are still assisting with car maintenance and repairs [Music] anyway the sales guy smelled blood when I showed interest in the jaguar and didn't want to let me go to the Chinese section next door [Music] um still I was adamant about seeing what the Chinese had to offer since I heard a lot of positive comments about their new cars from people I know including one of my subscribers in Moscow foreign [Music] 's parents were very generous and bought him a Mercedes which unfortunately was badly damaged in a car accident soon after it was purchased the repair Bill have come to a whopping 3 million 200 rubles or forty thousand dollars that's more than 70 percent of what they paid for the car so the family decided enough with the pricey European toys foreign foreign [Music] the Chinese have definitely come a long way in uh in car production uh I mean just judging by how these cars look I mean they don't look cheap to me I don't know look at this one that's it it's a nice looking car really uh I don't know about the quality uh but uh just you know visually these cars are very easy on the eyes [Music] thank you inside everything also looks pretty cool but there's four options apparently new Chinese cars are loaded with all the latest bells and whistles like a 360 degree parking camera and a sophisticated autopilot that allows you to let go of the steering wheel while safely staying in the lane but the most important thing these vehicles are way more wallet friendly than their Western counterparts [Music] the Chinese are aggressively cutting prices solidifying their grip on the lucrative Market that's been long dominated by American and European brands for instance the base price of this 2023 Cherry 7 Pro Max is 3 million 39 000 rubles or thirty eight thousand dollars but with all the discounts for trade-ins and credit incentives the prize drops to 2 650 000 Robles or thirty three thousand dollars this shiny new exceed SUV which is Cherry's premium brand goes for 4 million Rubles or fifty thousand dollars with all the discounts applied the price comes down to two million eight hundred rubles or thirty five thousand dollars not bad huh and there is the funny part when I casually mentioned my desire for a Jaguar the salesman in the Chinese section had a completely different take than his colleagues who deal with European cars over here [Music] I also couldn't resist checking out a brand new Russian car released in 2023 the mosque Beach I mean it's not 100 Russian basically the new mosque features a Chinese crossover Jag js4 assembled at a Moscow Autoplan formerly owned by Renault the French auto Giants sold the factory to moscow's government For a symbolic one Ruble in 2022 leaving around 5 000 employees uncertain about their future during the mobilization campaign I even met a former Renault employee at a Moscow enlistment Center who said he would earn more in the Army than on the Factory's assembly line foreign [Music] but the authorities managed to keep the majority of the Factory's Workforce employed by quickly switching production from French to Chinese models the use of the well-known mosque Beach car brand is mainly symbolic the primary goal was to save the factory from shutting down rather than develop an entirely new vehicle from scratch the fact that this is a Chinese car reassembled in Russia doesn't really bother me that much but we're really you know uh grinds my gears is the fact that it costs an arm and a lack to get this car here compared to its price back in China in China a Jag js4 starts at around nineteen thousand dollars in Russia moskovich goes for twenty five thousand dollars or 22 000 if all the discounts are applied um foreign of course sanctions have had a tremendous effect on the Russian automarket people now face higher prices and fewer options when shopping for a new vehicle as with any restrictions it's a two-way street though Western car makers have also suffered Financial losses as they've quit one of the biggest car markets in Europe leaving entire factories behind it looks like Chinese manufacturers are the only ones reaping benefits amidst all the sanctions and the fierce race between Russia and the West they've smoothly slipped into the Winter's Lane in Russia's car market without even having to shift into Top Gear as for me I decided to hold off on buying a new car for now it looks like my trusty old opal and I will be hitting the road together for at least another year and with your support for a few new parts here and there we'll be cruising along just fine [Music] thank you foreign [Music]

Channel: Real Reporter

Views: 739,129

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Id: JznnOP14qgo

Length: 19min 33sec (1173 seconds)

Published: Wed May 24 2023