Russia's Ministry of Industry and Trade has announced the completion of the first stage of its car recycling program, within the framework of which the Russian government has issued the planned 200,000 certificates for bonuses each worth Ruble 50,000 (approx. $1,620) to buy new Russian-made cars in exchange for scrapping old cars. The program officially started on March 8, 2010.
According to Alexey Rakhmanov, head of the Industry and Trade Ministry's automotive and agricultural machine manufacturing department, as expected the program benefited local producers, with some 161,354 certificates issued for the purchase of AvtoVaz cars and 10,722 certificates used to buy Russian-made Renault cars. Meanwhile, Ford cars ranked third in terms of the number of issued certificates. Slightly more than 81,000 cars have been sold using these certificates, Mr. Rakhmanov added.
The second stage of the federal car recycling program, during which the government plans to offer the next 200,000 certificates, is expected to start this week, Rakhmanov said, adding that the program now has "no time limit, and it will end when all the planned vehicles are sold."
Earlier this month, Russia's prime minister, Vladimir Putin, said that the government is going to grant another Ruble 10 billion (about $324 million) for the car recycling program.
JD Power Automotive Forecasting predicts that in 2010 the Russian car market will increase by about 17 percent year on year to 1.59 million units as a result of the boost provided by the scrapping program boost and the gradual improvement of the economic environment.