Chinese automakers are making gains in Russia as foreign producers leave

 Chinese automakers are making gains in Russia as foreign producers leave

In response to Russia's invasion of Ukraine during the past year, hundreds of international businesses have left the country. Russians have reportedly been compelled to find alternatives for everything from smartphones to cars as a result.

Chinese competitors' businesses gain. According to industry data, companies like Xiaomi, a leading manufacturer of smartphones, and Geely, a manufacturer of automobiles, have seen a rise in sales recently.

According to Counterpoint Research, devices from Xiaomi and another Chinese vendor, Realme, have replaced the once-popular iPhones and Samsung Galaxy models as the best-sellers.

Before the war, Chinese producers were well-liked in Russia and accounted for over 40% of the smartphone market in December 2021. According to Counterpoint data, they now control nearly all of the market, accounting for 95% of it a year later, CNN reported.

As they withdrew from the country, Samsung and Apple, who generally held the top two rankings, saw their combined market share fall from 53% to just 3% over the same time period, according to CNN.

Similar events are taking place on Russian roadways. According to data from S&P Global Mobility, Chinese automakers Chery and Great Wall Motor have surged into the top 10 passenger vehicle brands over the past year, while Germany's BMW and Mercedes have vanished.

According to statistics provider Autostat, Russians purchased a record amount of Chinese automobiles in 2017. Despite the market crisis, Chinese new car sales in the nation increased by 7% in 2022 to 121,800 units, according to a report released last month.

Following its invasion of Ukraine, international automakers, including Hyundai and Kia, two other sizable foreign participants there, withdrew from Russia, joining Renault.

According to Tu Le, the founder of Beijing-based consultancy company Sino Auto Insights, "it created a significant gap in the market." And the Chinese are happy to fill that gap, according to CNN.

According to Jan Stryjak, an associate director at Counterpoint Research, Xiaomi, Realme, and Honor, the cheap brand that was originally owned by Chinese tech giant Huawei, "reacted rapidly to seize the chance." In the third quarter of 2022, they increased shipments to Russia by 39%, 190%, and 24%, respectively, over the previous quarter.

The main winner has been Xiaomi, which has seen a year-over-year increase in market share. According to CNN, the Beijing-based business is currently the largest seller of smartphones in Russia in large part due of its well-liked Redmi series of reasonably priced smartphones with excellent cameras.