Germany destroying its car industry – Putin
Russian President Vladimir Putin stated during a visit to Moscow's All-Russia Exhibition Center that Germany's automobile industry is in decline, and the country requires assistance to salvage it.
Putin's comments were in response to reports about Russia's contribution to the emergence of the German automobile industry.
When asked if the decline is related to Russian consumers increasingly choosing Chinese cars over German ones, Putin mentioned that it is "not only that," without providing further details.
Germany's industrial sector, particularly its automotive industry, has faced challenges over the past year and a half.
Rising energy prices, following the loss of cheap gas supplies from Russia, have damaged the competitiveness of German manufacturers. The president of the German Automotive Industry Association (VDA), Hildegard Muller, warned about the impact of soaring energy costs on international competitiveness, leading some companies to consider relocating.
VDA data indicates that while German automobile production increased by 18% year-on-year to 4.1 million cars in 2023, it remained 12% below the pre-COVID year of 2019. Concurrently, orders received by German manufacturers declined by 5%, with domestic orders plunging by 18%.
In March 2022, amid Western sanctions on Moscow due to the Ukraine conflict, several German car manufacturers, including Volkswagen and Daimler Truck, suspended trade with Russia and later exited the market, allowing Chinese brands to fill the void. Chinese brands accounted for over 90% of all Russian car imports in 2023.
China has been actively working to increase its market share in the global automobile sector, becoming the world's second-largest car exporter behind Japan. Chinese companies have either competed with or acquired shares in European carmakers, such as Geely's acquisition of Swedish carmaker Volvo in 2010 and its founder, Li Shufu, becoming the largest shareholder of German automaker Daimler in 2018.
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