Russian car market sparks into life,
and heads for another logistics problem
ST PETERSBURG 20 May 2010: Russia car sales are back on the rise but the logistics challenges of a huge country with a poor road system remain. In fact for the delivery of finished vehicles, there may be a need for as much as 50% more capacity.
The car market has sparked into life since the introduction of a scrappage scheme in March 2010. Sales in April were 20% higher than the same month in 2009 and, with continuing high tariff walls against importing new cars, look set to keep boosting local production. Both OEMs and logistics providers are planning for better times ahead.
“The system is not currently under pressure,” says Jean-Philippe Jouandin, supply chain director for Renault Russia. But since an improving market means more sales in far-flung cities other than Moscow and St Petersburg, there will be a consequent increase in the average delivery times. Jouandin predicts a requirement for some 50% more capacity for outbound logistics.
“Since this…increase will arrive at the same time as a market increase, it will [lead to] some difficult challenges for the global finished vehicles transportation market,” he says.
These challenges and more will be the subject of intense discussions at this year’s Automotive Logistics Russia conference, to be held in St Petersburg from 22-24 June 2010. The fifth in the annual series, the event anticipates the challenges ahead with the theme: ‘Growth through Logistics: Controlling quality, processes, price and delivery in today's Russia.’
Speakers at the event include Jouandin, Ivan Karasev, head of logistics for Russian OEM Sollers (which has a joint venture with Fiat), Jan Bures, head of group service for Volkswagen Rus, and Dmitry Federov, logistics and dealer support manager for Nissan Rus.
They will be joined by other OEMs and a wide range of logistics service providers, reviewing the supply chain and transport options which include roads, rail, ocean & short sea, and ports & terminals.
There will also be expert contributions from legal firms which help the industry tackle the increasingly onerous customs and taxation system.
“The main problem faced in importing cars is a high rate of customs payments and the high cost of car deliveries,” notes Alexander Zhuravlev, chief executive of transport provider Major Auto Trans.
Meanwhile capacity in the market continues to be added, with a new General Motors assembly plant on stream in 2010, and new logistics solutions including the use of trans-continental rail to move Japanese cars via the Far Eastern port of Vladivostock.
The Automotive Logistics Russia conference draws wide attendance from across the Russian automotive industry, and is supported by Gold sponsors Gefco, a full-service LSP, and by Major Auto Trans and by Rolf SCS, both providers of finished vehicle transport.
The conference is part of a worldwide series of Automotive Logistics events, which is supported by Global sponsor Wallenius Wilhelmsen Logistics.
Silver sponsors for the Russia conference are BLG Logistics, Finnlines, Priority Freight, Schoeller Arca and Selsystem.
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