The Ministry of Industry and Trade proposed to reduce the target level of localization in the automotive industry

The Ministry of Industry and Trade of the Russian Federation proposed to adjust the requirements for the target level of localization of cars produced in the country, reducing the maximum possible localization score from 7 thousand to 5.5 thousand points. The corresponding draft government decree is posted on the federal portal of draft regulatory legal acts.

Measures to change the localization level are explained by the consequences of economic changes due to the coronavirus pandemic, which has led to global disruptions in supply chains, and falling demand due to economic constraints.

In addition, the automotive industry was affected by sanctions against the Russian Federation from unfriendly states, which led to the withdrawal of foreign manufacturers of automotive components, previously controlled by companies from unfriendly countries, and the subsequent restart of production sites that came under the control of Russian beneficiaries, the Ministry of Industry and Trade said.

"All these factors have forced the industry to quickly adapt to the new realities. The Ministry of Industry and Trade of Russia, as a regulator, in turn, adjusts the previously formed approaches taking into account these challenges," the press service of the Ministry of Industry and Trade noted.

The changes are aimed at concluding new special investment contracts (SPIC 1.0) and previously concluded between January 1, 2020 and January 1, 2026. The Ministry noted that the proposed adjustments do not mean a drastic easing of requirements in terms of solving the tasks of deepening localization, including those set by the approved strategy for the development of the Russian automotive industry until 2035.

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On September 30, it was reported that, as Anton Alikhanov, the head of the Ministry of Industry and Trade of the Russian Federation, said, passenger cars of more than 20 brands are currently being produced in Russia, and about 50 models have been put on the assembly line.

In August 2025, 37.5 thousand passenger cars were produced in Russia, which is 27.4% less than a year ago. In just eight months of this year, 420 thousand passenger cars rolled off Russian assembly lines, which is 2.9% less year-on-year.

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