The top 10 car nations, and we’re not in it

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These are the nations with the most new cars and trucks sold in 2012:

1. China, 17.4 million

2. U.S., 14.5 million

3. Japan, 5.2 million

4. Brazil, 3.6 million

5. Germany, 3.3 million

6. India, 3.2 million

7. Russia, 2.9 million

8. U.K., 2.3 million

9. France, 2.3 million

10. Canada, 1.7 million

That list was published at the beginning of this month, but already it looks as if Russia is poised to take 5th slot by the end of the decade.

The report, from global firm Boston Consulting Group, projects that Russia’s auto market, which totals about 2.9 million sales annually, will grow at an annual rate of 6 percent through the end of the decade and surpass 4.4 million per year.

Brave lad in a Lada.Brave lad in a Lada.

Russia is currently seventh – it was tenth in 2009 – but will be aided in coming years by special government programs to entice citizens to buy cars.  In addition, automakers like Ford Motor Co. and General Motors Co. have recently built plants in Russia for locally produced products.

Only China, the U.S., India and Brazil will be larger auto markets by 2020, according to the BCG report.  Russia will surpass Germany as the largest auto market in Europe by that time, though many in the industry expect that to happen in the next few years.

Though Russian auto sales are expected to fall this year compared to last – an assumption from analysts based on a scenario where the government won’t offer subsidies to citizens who buy low-priced cars, something auto executives expect will happen – the long-term prognosis is that localizing production will boost the Russian economy, and in turn, result in auto sales growth.

Overall automakers will invest more than $10 billion in upgrades and expansions in Europe through 2020, according to BCG.

Ford just finished building a plant with its joint-venture Ford Sollers in record time and will also build a new $274 million engine plant in Russia.  The Dearborn automaker will triple its capacity in Russia to about 350,000 units in coming years.

GM is in the midst of a $1 billion investment push in Russia to increase annual production capacity from about 100,000 to 230,000 vehicles.

Those capacity additions will not only help automakers fill the demand for autos in Russia, but also in nearby countries like Kazakhstan, Belarus, Ukraine and Uzbekistan, where auto markets are still in their infancy stages.  Anyone looking for a 30 year old Lada?