(Reuters) – April saw a drop in new car sales in Russia of 78.5% year-on-year. This was due to soaring costs and severe shortages, as well as volatile rouble and disrupted logistics.

The Association of European Businesses (AEB), Wednesday said that April’s new car sales of 32.706 vehicles were lower than one-quarter of the year before.

The AEB stated last month that sales of new cars are likely to decline by at least half off their 2021 level, following a 4.3% rise.

According to AEB data, April saw a 78% drop in sales of Lada vehicles by Russia’s biggest automaker AvtoVaz.

According to AEB, Russia saw a drop in sales of light-commercial and new vehicles during the first four months 2022. This was 43%, or 293,846 units.

Foreign automakers have been encouraged to set up factories in Russia because the Russian market was among the best globally.

Prior to the recent Western sanctions against Moscow over what it called “a special military operations” in Ukraine last year, Russian car sales reached 1.67million compared to nearly 3 million a year during the 2000s.