OREANDA-NEWS. Russia will become the largest car market in Europe, as consumers will begin to pay more attention to the dynamic characteristics of the car and they will be ready to pay more for the advanced features and capabilities. Government initiatives, such as subsidies, recycling program, incentives for automakers, whose production corresponds with the level of localization, it will speed up the growth of the Russian automotive industry.

According to the data of a new study of company Frost & Sullivan, by 2020, it is expected that the annual sales of passenger and light commercial vehicles in the country will exceed 3 million units. Therewith, more than 40% of passenger car sales during this period will be in the segment of compact models.

"Love of consumers to small, economical in terms of fuel consumption vehicles will determine the highest growth in the segment of compact cars and crossovers", - says Anna Ozdelen, Consultant of Department of automotive and transportation industries, Frost & Sullivan. - "Russian consumers are paying increasingly more attention to driving performance, compared with buyers from the UK, Germany and France".

In addition, the low level of car ownership and the aging car parc is the main driver of growth in demand for new cars. Automakers, such as Renault-Nissan, will penetrate deeper into the compact car segment and SUVs. Recycling program, which was reset this year, also stimulates the growth of sales of compact cars. The low level of saturation of the market compared to the UK, Germany and France will contribute the growth in the long term.

However, this growth will be restrained temporarily by geopolitical tensions in the Ukraine, the deteriorating economic situation, which undermines the confidence of consumers and reduces the demand even in large cities. Car manufacturers should pay attention to smaller cities such as Nizhny Novgorod, Chelyabinsk, Rostov-on-Don and Kazan that offer the best opportunities for marketing.

"Russia will also be a key market for infotainment and telematic systems for cars", - concludes Anna Ozdelen. - "Customers appreciate the quality and useful feature packs, and suppliers can use it to enter the Russian market of automotive products.