The past year was marked, as in many other areas, by significant steps in the transport sector and the implementation of a number of reforms. In particular, approved by the Cabinet of Ministers of Azerbaijan on March 27, 2024 and entered into force on July 1, 2024, “Requirements for technical indicators, internal and external design of vehicles used for regular passenger transportation and passenger taxi cars” are one of the necessary steps in plan to renew the country’s vehicle fleet and relatively reduce environmental pollution.
One of the factors that will make a significant contribution to the renewal of the vehicle fleet, and, one might say, the most important, was the start of the vehicle recycling process at the end of last year. Starting this process is important, which will lead to a significant reduction in the number of older vehicles considered unroadworthy, in favor of more modern and environmentally friendly vehicles. In addition, the introduction of certain benefits and incentive mechanisms for environmentally friendly cars in terms of switching to green energy has significantly increased interest in new cars and vehicles with an electric motor. The increase in demand has led to certain price changes in the automobile market.
What is the forecast for this year in connection with further renewal of the vehicle fleet and, in particular, car prices against the backdrop of changes that occurred in 2024?
As Day.Az reports, in this regard, the executive director of the Azerbaijan Automobile Dealers Association, Eyyub Aliyev, told Trend that some trends that existed last year will continue in 2025.
“I think that in 2025 there will be greater demand for domestically produced cars. An increase in demand, in turn, may lead to a shortage of domestically produced cars. This will certainly increase demand and interest in other cars on the market, mainly new cars Because the main purpose of recycling is to renew our vehicle fleet. I believe that citizens already understand that cars with an old model year cause serious damage to both their budget and our environment. I would call 2025 the year of new cars,” he said.
After the new requirements were introduced, a large increase in purchases of cars of a newer model year, especially domestically produced passenger cars, began to be recorded. Thus, in the field of production of machinery and equipment, vehicles, cars, trailers and semi-trailers in Azerbaijan, products worth 725.8 million manats were produced in January-November 2024. Compared to the corresponding period of the previous year, the production of automobiles, trailers and semi-trailers increased by 56.6%, the production of machinery and equipment decreased by 46.1%, and the production of other vehicles by 52.9%. From January to November 2024, 5,225 units of passenger cars were produced, which is 2,088 units more than in the same period last year.
In addition to production, a noticeable increase was noted in imports. Thus, in January-November 2024, Azerbaijan imported 2,871 units of vehicles with electric motors worth $114.8 million. Compared to the same period in 2023, this is 134 units (4.9%) more in quantity and 3 million 745 thousand US dollars (3.4%) more in value.
How will the presence of positive dynamics in the production and import of cars affect their price?
Regarding this issue, Eyyub Aliyev noted that during the first two quarters of the year, car prices are not expected to increase in the country.
According to him, official producers have not seen any increase in prices. The main principles and goals of official manufacturers at the moment are to increase the guarantee and quality of service. Car prices are not expected to rise, at least in the first and second quarters of 2025.
“There may be some increase in prices for cars due to an increase in logistics costs. But in the current situation, no increase in prices for cars is expected,” E. Aliyev said.