When will Russians get behind the wheel of an electric car?
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The government is expecting Russians in the next 20 years to switch over to driving electric cars.

   More than half the cars in Russia in 20 years will be electric, Deputy Prime Minister Yuri Borisov told the Tass news agency. And various institutions are preparing support programmes to produce electric vehicles in the country.

   At the moment, there is no mass production of electric cars in Russia, but authorities are still planning to introduce import duties on such vehicles.

   “Many carmakers, world giants, plan to turn production over entirely between 2035-2040 to electric vehicles. Using hydrogen engines for environmental considerations is a sustainable trend,” Borisov said.

    “Russia cannot stand on the sidelines and by 2035-2040 at the very least, electric vehicles will dominate the overall number of cars. And of course, it is in our interests that these cars be made on the territory of Russia. The Ministry of Industry and Trade is putting together programmes on electric vehicles in the very broadest sense.”

    Looking for 140,000 electric cars on the roads in Russia!

    In May, Denis Manturov, Russia’s Ministry of Industry and Trade, made an unexpected announcement – that the government intended from 2030 to introduce a quota of “green vehicles” for carmakers in terms of car sales. At issue were cars powered by hydrogen, electricity and gas.

    The ministry then announced that by the end of the year it would develop guidelines for production of cars with a low carbon footprint. And the guidelines would set deadlines for meeting those quotas for producing “green” cars.

    Government forecasts for the market for electric cars were optimistic.

    As was said by Maksim Kolesnikov, the Director of the Department of economic sectors of the Economic Development Ministry, the number of electric cars produced in Russia by 2030 could reach 10 % of total country-wide production. Some forecasts put that figure at 15 %.

    For the moment, electric cars are not mass-produced in Russia and they are imported only unofficially. Statistics show that at the moment, electric cars make up less than 0.01 percent of the total number of cars on the market – a little more than 10,000 out of a total of some 50 million.

   The Economic Development Ministry is drafting guidelines on producing and using electric and hydrogen-powered transport in the country. According to a draft, investment in production of green transport should amount to 850 billion roubles ($11.7 million) – including 600 billion from private investors.

    The ministry predicts annual production of electric vehicles will reach no less than 150,000 by 2030.

    Such an assessment appears too optimistic, given that production is starting from scratch. But unlike the market as a whole, it is entirely possible to have electric cars make up half of all the new cars sold in the country. Russia, at the moment, stands third from the bottom of 25 countries surveyed by KPMG

In terms of infrastructure readiness to develop electric transport.

“Green” support

    According to a survey conducted by Rosgosstrakhbank, 45 % of Russian residents believe electric cars are more environment-friendly and are prepared to switch over to them. A majority said they would make that switch for environmental reasons or because they find electric cars safer. But a half also believed that electrical cars were more expensive and a third favoured the lifting of taxes on such vehicles.

    The government says it intends to boost demand for electric cars, but for the moment no support programme has been drafted.

    The Ministry of Economic Development is proposing compensation of up to 25 % of the cost of the car upon purchase. But to be eligible, a car must cost no more than 2.5 million roubles ($34,600).

    Co-financing is being considered to set up rapid charging stations and produce electric vehicle cells, cathode and anode materials and hydrogen fuel cells. The government believes that would allow for the creation of “stimulative” technology in Russia to produce batteries and component parts.

    Also planned is the construction of 150,000 charging stations for cars and projected spending on this is 37.7 billion roubles. Plans call for one station to be built for every 10 cars in use and at intervals of 100 km on federal roads. Also under consideration are the removal of transport taxes as well as free parking for owners of electric cars.

    Media reports say pilot projects are being planned for Moscow, St. Petersburg, Sochi, Sevastopol, Kazan and Kaliningrad.

    By way of comparison, the United States intends to provide $174 billion in government support for production of electric cars — including $100 billion on tax breaks and discounts for purchasing cars.  A total of 500,000 charging stations are to be built by 2030 – including in apartment buildings and public parking lots — $15 billion has been allocated for this.

    No production. But no imports.

   Although there is no production of electric cars at the moment, the Tolyatti plant may start production of the Zetta model this year. This is a small model costing – for a basic version – about 500,00-600,00 roubles ($6,900-$8300) and its maximum speed is 120 kph. The company had initially intended to manufacture up to 15,000 models per year, but the launch of the project kept getting put back, owing to a lack of financing and the failure to find attractive borrowing rates.

    A second candidate for government support is the Kama-1 model produced by KAMAZ. The company has so far displayed only an experimental model but production might start in 2024.

    The government has already indicated that it intends to limit imports. Measures include an increase in rates for scrap metal collection and a requirement on local production.

    The current zero duty on imported electric cars may not be extended. That rate was introduced at the initiative of Belarus in May 2020 and is to remain in use until the end of this year.

    In the new draft of trade rules for the Eurasian Economic Union, a proposed duty of 15 % is under discussion. A decision on the matter is to be taken this summer. The Ministry of Economic Development says documentation submitted to public discussion sets the base rate of import duty at 15 %.

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