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Expert: What waits auto market of Azerbaijan next year?

01.10.2019,10:00


 October 1, Fineko/abc.az.This year is gradually coming to an end and could be described as positive from angle of the dynamics of the automobile market in Azerbaijan. One of the main conditions of this positive factor is the relative stability of the national currency. During the year there were no jumps in the movement of the manat, and that is why the car market has remained stable. 

Motor transport expert Eldaniz Jafarov has commented on the situation in the automobile market. 

"According to forecasts, electronic cars are going to make up 17% by the end of 2020," the expert believes.
He points out that 75% of those motor vehilces will not be electric fully, they will be a kind of hybrid: "That is, in many countries the hybrid will remain a priority because of the lack of electric vehicle infrastructure. We can already say that in the next 6 years the number of electric cars will increase on the streets of Baku, and people will even drive unmanned vehicles. In 2020 and the next two years the segment of electric vehicles and hybrid CUV will expand in the automotive market of Azerbaijan. Crossovers are less profitable than SUVs by their fuel consumption, and height-easier to manage compared with sedans. Crossovers will also be popular in our country next year."
Jafarov says that Azerbaijan observes an increase in car production with the launch of the automobile plant project in Neftchala.

"This growth, however, does not play a decisive role in the autombile park of Azerbaijan, as it cannot cover even 20% of the current demand. Last year, 1,000 motor vehicles were manufactured and sold. According to the responsible persons, the plant is capable of producing up to 10,000 cars a year. The cars of our own production are not competitors to new cars from Europe, U.S. and Japan. So, it would be wrong to regard the current high customs and excise duties as support for domestic production," the expert emphasized.
He added that the country’s motor market will develop with growth of 2% a year. 

"The main factors influencing the growth are the stability of the national currency and the stability of the economy. Another factor relates to the growth of exports of diesel cars from the EU and hybrid cars from the U.S. Currently, the real demand in Azerbaijan is about 40,000 cars a year.
The era of traditional fuel cars will end in 2025. It would be good if the state would stimulate the import of electric and hybrid models running on unconventional fuel in the country - in this case, we’ll not lag behind our neighbors and would import failed cars in our country, as it was a few years ago. The high level of bank interest car loans, customs and excise taxes does not allow citizens to buy new cars. For this reason, they are forced to buy inexpensive cars that are not suitable for use, harmful to the environment and health. Private banks require 40% of car value and 16% per annum from car loan borrower as an initial payment. These are fantastic figures, and, of course, they are not profitable for car buyers. It will be advisable if the initial contribution is set at 20%, and annual contributions at the level of 8%-9%," the expert stressed.