No Connection Between Russia and 2,000% Rise in Car Sales to Azerbaijan- British Auto Industry

According to a recent report, the British auto industry shipped an additional £40 million worth of vehicles to Azerbaijan in the first month of this year, prompting more concerns about whether the vehicles were shipped there in order to get around sanctions on Russia.

While direct auto exports to Russia are still at zero, as they have been since sanctions were imposed in 2022 following Russia’s invasion of Ukraine, new data from HM Revenue & Customs reveals that in January, £43 million worth of automobiles were shipped to Azerbaijan, the former Soviet country that borders Russia.

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This means that Azerbaijan, which had previously very infrequently appeared among the top 75 export markets for British automobiles, is currently the 12th-largest overseas market for these vehicles in terms of value, behind only Switzerland, Canada, and Spain.

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UK automakers have committed not to sell vehicles to Russia, as sanctions formally prohibit the export of “dual use” equipment that could be repurposed as weapons in the Ukraine conflict. There are separate fines worth more than £42,000 that prohibit the trade of automobiles. But a recent analysis released last week revealed that auto shipments from Azerbaijan to Russia increased almost simultaneously with the dramatic increase in British car exports to Azerbaijan during the same period.

Related: Russia’s Car Sales Increased by 69% in 2023

The average value of cars sent from the UK to Azerbaijan in January was just over £115,000. Trade data also shows that similar increases in British exports have been seen in other former Soviet Russian neighbors, including Kazakhstan, Armenia, and Georgia.

Surge in UK car exports to Azerbaijan

A spokesman from Britain’s motoring lobby group, the Society of Motor Manufacturers and Traders (SMMT), said it had detected no evidence the vehicles being sent to Azerbaijan were destined for Russia – and that they were evidence that it was a “flourishing market in its own right”. It said:

“UK vehicle exports to Azerbaijan – as to many countries globally – have increased due to a number of factors, not least a flourishing economy, new model launches, and pent-up demand.”

Interestingly however, the notion that the exports were evidence of a flourishing economy stands in stark contrast to the economic data, which show that Azerbaijan’s GDP per capita has been flat for a decade and a half at around $15,000 in purchasing power parity terms. Since two years preceding the pandemic, the value of car exports to Azerbaijan has risen by more than 2,000%. No other sizeable car market in the world has come close, save for Kazakhstan, the other Russian neighbor, whose imports of British-made cars are up 800%.

Related: Russia Makes Citroen Knock-Offs with Help From Chinese Partner

Furthermore, there have been similar flows detected from other European nations, including Germany and Poland, to other former Soviet states neighboring Russia.

Source: SKY

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