GM Uzbekistan’s car sales fell by 62.2% y/y to 3,249 units in Kazakhstan in January-October, according to the Association of Kazakh Auto Businesses. At the same time, the sales of GM Uzbekistan cars jumped by 26.3% m/m to 664 units in October.

The increase in the sales of Uzbek-made cars in Kazakhstan in October is explained by a sharp devaluation of the tenge since August 20 when the authorities allowed the Kazakh currency to float freely. This decreased the dollar price of Uzbek cars making them competitive compared to similar-priced used cars usually sold for dollars, and cars purchased in Russia.

Total sales of new cars fell by 9.2% m/m and 49% y/y to 7,545 in Kazakhstan in October. The sales fell by 37.72% y/y to 84,560 units in January-October 2015.

In autumn 2014 Russia’s announcement of a free-floating exchange regime for the ruble led to a slump in the value of the Russian currency compared to the tenge, which was pegged to the dollar until August 20. This created a shopping spree among Kazakhs who headed to Russia to snap up bargains from cars to white goods.

The process has somewhat slowed down as the nearly 60% devaluation of the tenge since August evened out car prices in Russia and Kazakhstan.