Despite the summer season, the Azerbaijani car market is not seeing the traditional revival, according to Eyyub Aliyev, chairman of the Azerbaijan Automobile Dealers Association (AADA). Sales are below expectations, and problems from last year persist.
One of the main reasons is the abolition of customs and tax benefits for eco-friendly vehicles this year. The non-extension of benefits was known since Q3 of last year, leading to record imports by parallel importers and investors. Cars were sold within 5-10 days, but sales have sharply declined since early this year.
Prices drop below cost
Weak sales have left some importers unable to sell cars for months. Sellers first offered cars at cost, then below cost, triggering a price war. Daily price changes are affecting buyer behavior, delaying purchase decisions and increasing uncertainty. Excess inventory from last year's imports exceeds real demand.
Positive dynamics in the used car market
Despite challenges with new cars, the used car market shows positive trends. Sales of cars from South Korea, Japan, and Germany have increased, though not across all brands and models.
Official dealers adjust pricing
Official dealers have negotiated with manufacturers to offer more competitive prices, narrowing the gap with parallel importers. New Chinese export rules, including a six-month restriction, may help stabilize the market.
Expert opinion: stability expected
Huseyn Talibov, member of the Azerbaijan Appraisers Chamber, notes limited activity this summer. Buyers are cautious due to inflation and high interest rates. Most sold are 8-12 year old economy cars. Supply exceeds demand, with used cars selling 5-10% below initial listing prices. No sharp price changes are expected until the end of summer.
