How new changes to impact car market
Azerbaijan will apply new import and export customs duties next year, which will also concern the import of cars, which import has significantly increased from the beginning of the year.
Azerbaijan will apply new import and export customs duties next year, which will also concern the import of cars, which import has significantly increased from the beginning of the year.
The Cabinet of Ministers approved the “Commodity Nomenclature of Foreign Economic Activity, Rates of Import and Export Customs Duties”, which will come into force on January 1, 2018.
So, how these amendments will affect the country’s car market, showing 86 percent growth for January-October compared to the same indicator for the corresponding period of the last year, is one of the most discussed topics.
Commenting on the impact of the new document on the car market, expert Rashad Guliyev said that the situation in this segment is not encouraging, but the purchase and sale continues.
The expert stressed that price increase in this situation is inevitable.
“Changes in import duties will affect the car market as a whole, partially or dramatically, depending on the interest rate. It is impossible to say for certain what prices will be on cars, but the price hike will be exactly.”
The reason for this is the recent loss of the value of the national currency, as well as a new change in customs duties, according to the expert.
Azerbaijan, currently working to develop its car manufacturing industry and encouraging interior purchases within the country, now is operating with different courtiers to develop its own automobile manufacturing market.
Currently, the country plans to produce cars jointly with Iran and will soon launch manufacture
cars in the Neftchala Industrial District. The plant will operate on the basis of joint project of AzEuroCar LLC and Iran’s largest car manufacturer Iran Khodro. The plant was due to open in June, but because of the cold winter there were delays in the plant's construction. The opening is rescheduled for August.
The plant with a capacity of about 10,000 cars per year initially will produce four Iranian car brands – Dena, Runna, Soren and Samand. The cost of the project is estimated at $15 million.
Production of some spare parts is planned in local factories. For this, proposals will be made to the plants and if the plants receive positive feedback from the Iranian company, then the production of spare parts will launch.
The plant intends to cooperate with the Sumgayit Industrial Park and SOCAR’s new plant. Some 20 percent of the vehicles will be exported to CIS and Central Asian countries.
Speaking about how the plant will get a share in the local market, Azeurocar’s representative said the plant will produce the cheapest cars.
“The price of new cars will be 10,000-12,000 manats ($5,8007,000). The cars produced at the plant will meet Euro 5 standard”.
First cars of Azerbaijan-Iran joint car plant are planned to be manufactured beginning from 2018.
While visiting the Neftchala Industrial District in September, President Ilham Aliyev noted that the plant will help to a certain extent to eliminate dependence on imported cars and at the same time, there will be opportunities for exports.