Sales of household appliances and electronics fall in Russia as interest rates soar

A sharp increase in consumer loan rates following the Russian Central Bank's key rate hike has impacted sales of household appliances and electronics in Russia. Source: Russian online newspaper The Moscow Times Details: "I don't remember such a situation in the home appliances and electronics market.

Our market is going down," wrote Dmitry Alekseyev, co-owner and president of DNS Group, one of the largest sellers of appliances and electronics in Russia, following the results of the first quarter.

"It has happened before that the market fell in units, in dollars and even in real roubles adjusted for inflation. But in all my 30 years in business, I don't recall it ever declining in actual roubles," he said. The newspaper notes that exact figures are not yet available, but Alekseyev estimates the decline to be around 15%.

Alekseyev attributes the drop to high interest rates. According to the Central Bank of Russia, the portfolio of unsecured consumer loans has been shrinking since November.

Previously, around 30% of household appliances and electronics were purchased on credit, but with lending rates now too high, credit-based sales have dropped to just 5%. As a result, retailers are reducing their imports of appliances, and by summer, consumers may face a more limited selection of products.

"Due to the decline in demand and the lack of working capital for new purchases, we've reduced imports of household appliances and electronics from China by 30% in the first three months and are focusing only on the most popular items," an employee of a foreign trade company said. Another appliance supplier mentioned that they are importing about 25% fewer appliances this year compared to 2024. Background: Russia is experiencing a crisis in the freight market: one in five transport companies left the industry in January-March.

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