History of the Russian Automotive Industry

The history of the Russian automotive industry goes back to the last decade of the 19th century. The first ever Russian motor vehicle was built in 1896 by Frese & Co. coach manufacturing factory in St. Petersburg. The "self-propelled carriage" was first mentioned as offered for sale by the "Engineering and Foundry Works" of Eugene Yakovlev on the advertising page of "Novoye Vremya" ("New Times") daily on 27 May 1896
However, serial automobile production started in 1909 at Russko-Baltiysky Wagon Plant, Riga (Russo-Baltique brand). In 1916, production of trucks was launched at AMO auto plant built in Moscow by Ryabushinsky brothers industrialists. Subsequently, this plant became a leader of the Soviet automobile manufacturing (ZIS and later ZIL brands).

Development of the automotive industry gained momentum in the Soviet period. Study of the worldwide expertise was combined with unique projects adapted to the country’s specific character. In October1918, at the height of Civil War, the Automotive Research Laboratory, well known today in automobile circles as NAMI Automotive R&D Institute, was established. In 1932, GAZ Automobile Plant was built in Gorky (Nizhny Novgorod), which formed, alongside with ZIL, the basis of the national automotive industry. In thirties, automobile works in Moscow, Gorky and Yaroslavl rolled out scores of thousands of trucks, cars and buses, their performances being comparable to those of the best foreign models.

The middle of the last century saw construction of modern plants, launch of new engineering facilities and soaring motor vehicle output. New brands appeared to gain worldwide recognition, these are UAZ, Moskvich, Ural. With putting into operation of Volzhsky Auto Plant (VAZ) in 1969, scale motorisation of the country’s population began. In 1974, the first heavy-duty truck rolled from the assembly line of KAMAZ new plant, which is ranked today as the leading Russian truck manufacturer. The Russian automotive industry became a respectable and equal member of the international community of vehicle manufacturers. Such giant plants as GAZ, ZIL, VAZ, KAMAZ joined global leaders of automobile manufacturing. By 1980, the Soviet Union was producing about 2.2 million vehicles of all types a year.

After breakup of the Soviet Union and changing the economic system of Russia in 1990's, the automotive industry found itself in a critical situation. Imports became the major products on the Russian automobile market. In order to support local production and promote creation of jobs, the government opened in 2005, on easy terms (under investment regime of the so-called industrial assembly), access to Russia for international automobile companies organizing there output of their vehicles. Along with traditional domestic manufacturers, more than twenty foreign companies organized production of vehicles in Russia.

Another difficult situation was faced by the automotive industry during the recent years featuring COVID restrictions and the exodus of Western OEMs following the sanctions imposed on Russia over the Ukrainian conflict.

However, we have survived. The Russian automotive industry comes in the Top 10 most developed auto industries worldwide.

We have got the strategy of the industry development approved by the Government of the Russian Federation. We have achieved a notable growth of motor vehicle production and sales.

Nowadays, about 300,000 people are employed in automobile manufacturing in Russia, and over two million people are engaged in allied industries. The consolidated contribution of the automotive industry and allied industries to the country’s GDP amounted to 5.8% in 2019.

As a result, the size of motor vehicle fleet in Russia is approaching 60 million units, a growing share of vehicles complying with string ecological and safety standards. For example, there are over 1,000 electric buses serving urban routes in Moscow. This is the best result among big European cities.

Despite challenges sent by COVID and the imposed sanctions, the Russian auto industry does not slacken its pace of work on creation of highly automated motor vehicles, development of the legal framework and forming the infrastructure for safe use of vehicles.

Also in the focus are issues of technical regulation and standardization, customs legislation, raising competitiveness of the industry’s products, economic security, information policies, labour market, and state support of export activities.

125th anniversary of Russian Auto Industry Click to see the video