Chinese Industry and Localized Production: How Kazakhstan’s Automotive Market Is Changing

New cars are accounting for an increasing share in the overall sales structure, an indication of a gradual upgrading of cars on the market. However, the export potential of Kazakhstan’s auto industry remains untapped as car deliveries to Russia, whose new car market is approximately eight times larger than Kazakhstan’s, have been declining.

According to the results of the first half of 2025, there were more than 104,000 new cars sold in Kazakhstan, an increase of 26,2% in comparison with the same period last year. That’s according to data from the Kazakhstan Automobile Union. In June, more than 19,000 vehicles were sold, 16,2% more than in June 2024.

According to the Kazakhstan Automobile Union, in June 2025, the Hyundai brand was the sales leader (4,116 cars, +17.2% year-on-year), followed by Chevrolet (2,228, +22.8%) and Kia (2,203, -26%). The top five also included Chinese Jetour (1,493, +125.5%) and Chery (1,417, +14.4%). In the first half of 2025, Hyundai sold 24,218 vehicles (+32.8%), Chevrolet 13,306 (+66.9%), Kia 11,319 (-1.7%). Chinese manufacturers Haval, Geely, Changan and JAC also showed significant sales growth.

At the same time, sales of new cars are outpacing production volumes in Kazakhstan. According to government forecasts, in 2025, car production in the country will grow to 149,000 vehicles, 5% more than in 2024.

Chinese cars are expected to continue increasing their market share: for example, in 2025, the multi-brand Astana Motors Manufacturing Kazakhstan (AMMKZ) plant will be launched in Almaty to produce Chery, Haval (Great Wall Motor) and Changan vehicles. The first models planned for assembly include the Chery Tiggo 2 Pro, the Haval Jolion, the Changan CS55 Plus and the Tank 300.

There is a great potential for exports of vehicles produced in Kazakhstan, especially considering that many brands have left the neighboring Russian market, freeing up part of the passenger car niche, while solvent demand for cars has remained.

What is happening on the Russian market?

In Russia, following the departure of Western brands, the market has shifted towards Chinese cars, which occupy about 60% of the segment.

In 2024, about 1.57 million new cars were sold in Russia, 58% more than in 2023. Now the demand has decreased, because with a relatively high interest rate, it is more profitable for Russians to keep their money in bank deposits. However, according to forecasts, more than 1 million new cars may be sold this year. That is about five times more than in Kazakhstan.

Over the past three years, Russian car dealers have been able to restructure their business processes and establish new supply channels, primarily from China, as well as Kazakhstan and other countries. Dealers in the Russian regions have been able to adapt to the situation and reorganize their businesses quite quickly. Prominent examples include AGAT (Nizhny Novgorod), KAN AVTO (Tatarstan) and Klyuchavto (Krasnodar). They had half-empty showrooms of departed foreign brands and were able to quickly build new ones from scratch.

Nizhny Novgorod dealer AGAT has historically developed its business exclusively in the regions, bypassing the two biggest cities, Moscow and St. Petersburg, where it is more difficult to make money due to high competition. The group has relied on massive brands: Lada, Kia, Hyundai, Mitsubishi, Ford, Toyota, Geely and Chery. When many foreign brands ceased to be available in Russia, AGAT switched to Chinese brands, which now form the basis of its portfolio.

Over the past two years, AGAT has opened 86 new dealerships and now — with revenue of 158 billion rubles (over 1 trillion tenge) by the end of 2024 — is among the top five Russian car dealers. AGAT general director Ivan Mamochkin expects increased competition among dealers against the backdrop of weakening demand. «This year, there will be an even more fierce battle for fewer customers, because all players — both Chinese manufacturers and [Russia’s] Lada — are aiming to increase their market share or maintain it.»

Another Russian dealer, KAN AVTO from Kazan, offers 28 Chinese brands in 32 dealerships in the Tatarstan region, some of which are produced within the trilateral customs union of Kazakhstan, Russia and Belarus. According to KAN AVTO President Alexander Kolesov, since its inception two decades ago, the company has sold about one million cars. It cooperates with all the world’s leading auto brands from the U.S., Europe and Asia, such as Chevrolet, Cadillac, Ford, Mercedes-Benz, Kia and others. It was also one of the first to bet on the prospects of the Chinese auto industry, opening a Geely dealership back in 2020.

The latest example of cooperation between KAN AVTO and Chinese automakers is the Li Auto brand, which competes with European luxury brands and was very popular in Russia even before the start of official sales, according to Kolesov, whose company expanded sales of new cars by 60% in 2024 and increased revenue to almost $900 million.

«The Chinese auto industry is developing by leaps and bounds and has forever changed the global automotive market. Today, few in the world can compete with it in terms of production volumes, as well as modern technologies and advanced developments,» Kolesov said.

Despite the availability of cars in Russia, locals are showing an interest in buying cars across the border in Kazakhstan, and media outlets have been publishing detailed, step-by-step instructions on how to buy cars from manufacturers that left Russia after February 2022. Demand is the highest for JAC, Chevrolet, Kia, Hyundai, Skoda, Ravon and Hongqi.

Experts believe the share of Chinese cars on the streets of Kazakhstan and Russia will continue to grow. Just a few years ago, Chinese cars were a rarity in those countries. Now, by the end of 2025, the share of Chinese brands in new car sales in Kazakhstan may exceed 50%, according to a forecast by the American company Automotive Ventures, which specializes in investing in startups that focus on automotive technologies.