Uzbekistan: Car buyers turning to foreign brands
For the last two decades or so, motorists in Uzbekistan could buy any car brand they wanted, as long as it was either a Daewoo or Chevrolet.
This limited selection resulted from the de facto monopoly held by government-controlled UzAvtosanoat (UzAuto), which manufactured vehicles under those brands through joint ventures.
The ongoing economic liberalisation is altering this dynamic.
Data reported by Tashkent-based outlet Gazeta.uz reveal how far things have changed over the past year, however. While Chevrolets are still a ubiquitous sight on Uzbekistan’s roads, there is growing variety.
In 2023, Uzbekistan imported over 73,000 vehicles, marking a 2.4-fold increase from the previous year. The total value of those incoming vehicles amounted to nearly $1.8bn.
Last year was a banner year. The 30,000 vehicles imported in 2022 was a modest 12.7% rise on the year before. The value of vehicle imports in 2021 was just $588mn.
Chinese carmakers have done most of the running. Shipments of vehicles from China to Uzbekistan surged more than fivefold over that period, Gazeta.uz reported, citing State Statistics Agency data.
That means China’s automakers are now easily dominating market share for imports. Almost 80% of foreign-bought vehicles arrived from there in 2023, up from 36.9% in 2022. More cars are being imported from Germany, Japan, South Korea and the United States, but their market share is in relative decline.
Russia’s auto sector has experienced a total collapse in exports to Uzbekistan, meanwhile. More than 4,500 vehicles were shipped from there in 2021; that went down to 1,500 in 2022, the year that Russia incurred industry-sapping economic sanctions in response to its invasion of Ukraine, and now the numbers are so tiny that they are pooled together under the “other countries” rubric.
Another development of note is the rapidly growing demand for electric vehicles (EVs). President Shavkat Mirziyoyev said earlier this week that sales of these vehicles have increased 10-fold over the past three years. In 2023, 35% of vehicle imports were electric and hybrid vehicles, he said.
Mirziyoyev in December 2022 signed a decree mandating the installation of 2,400 charging stations for EVs over a two-year period. The same initiative required that all shopping, entertainment and business centres, gas stations, hotels and infrastructure facilities along highways built after January 1, 2024, be equipped with EV charging stations. Operators of the charging stations were under that decree permitted to set their own tariffs for electricity.
Variety in the car market is also being enabled by the arrival of more investors, again from China.
Mirziyoyev last month travelled to the headquarters of leading Chinese automaker BYD in Shenzen to oversee a remote launch ceremony for an assembly plant of hybrid and electric cars to be built in Uzbekistan’s Jizzakh region. Once completed, the factory will turn out 50,000 units per year.
Mirziyoyev said at the ceremony that the plant needs to be upgraded “in the near future” to accommodate production capacity of up to 300,000 units.
BYD is only the latest Chinese automaker to set up shop in Uzbekistan.
Uzbek vehicle distribution company Roodell began assembling cars for Wuhu-based Chery Automobile in September 2022, also at a plant in Jizzakh.
This article first appeared on Eurasianet here.