Kazakhstan Automotive industry represents a new frontier for the Central Asian due to the strategic position between China and Europe and the free trade agreements inside CIS zone.
The strategic decision of the government to form automobile manufacturing dates back to the early 2000s. State-allocated funds were allowed to build the automotive industry from scratch, and by the end of 2014, the industry reached the production volume of 38,000 vehicles. The existing production capacities allow assembling of up to 70,000 vehicles per year.
Since the end of 2015, Kazakhstan officially gained a long-awaited WTO membership and by its rules, customs duties for foreign cars will have to be reduced to 12.5% from 23% in five years. This would have a dramatic impact on the market, generating increased competition for the local producers.
This effect will be somewhat counteracted by additional government support through so-called car recycling duties as a means to develop proper recycling infrastructure in the country. This will place a significant price pressure on the consumers.
In the next years, decline in the real income of citizens, low oil prices and a slowdown in economic growth may have a negative impact on the sector. The 2016 is indeed project to drop almost 50% from the previous year with new car sales may hit bottom at around 50,000 vehicles (both passenger and commercial) before to gradually increase afterwards.
The clear winners under these circumstances could be brands that provide car models under US$10,000 with engine sizes of up to 1.6 litres. This is subject to the car recycling duty staying in place. Local automobile producers are already expanding their production lines to include budget-models of Chinese automobile manufacturers.
Research, Consulting, Data & Forecast Store
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Market Researches in PDF are immediately available for download with study on the market since 2005 and with forecast up to the 2020.
Auto Data in EXCEL are immediately downloadable with annual sales volume, split by month, for all brands and all models distributed in the market. This year data are released year to date, but you will receive a monthly update until the year-end.
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