Import duty on automobiles expires today

Today, the additional 13% import duty on imported passenger cars that was imposed at the beginning of 2009, expired. Yegor Samusenko: For local passenger car manufacturers, the lifting of the import duty means renewed price competition from new imports. Ukrainian carmakers, whose share of new sales decreased from 72% in 7M08 to 45% in 7M09, could see a further reduction in their market. Several law drafts have been registered in the Verkhovna Rada to impose new duties to protect local auto manufacturers, but we believe the soonest any could be enacted is January 1, 2010. This would still leave car dealers sufficient time to import enough vehicles to satisfy demand until new models debut in September 2010. In terms of local stocks, the news does not have an immediate effect since it has been anticipated.