Over 91,000 cars have been converted in Ukraine over the past 6 years. How does this business work today?
Those who have been engaged in the automobile business in Ukraine for a long time remember the period when so-called "beads" and "pies" with mileage were brought to Ukraine en masse from abroad. However, they were not bought for the transportation of goods, but for the transportation of passengers or for personal use, after conversion into passenger cars and buses. Whether such a procedure is relevant now, which models most often change their purpose, and how the field of car conversion lives today, experts of the Institute of Car Market Research investigated.
Why are trucks converted?
Until 2014, used trucks were converted into cars, primarily due to the difference in cost. First, commercial vehicles are cheaper than their passenger counterparts — for example, the Vito cargo is significantly cheaper than the "original" passenger Viano, built on the same basis. Secondly, the cost of customs clearance of trucks at that time was much lower than that of cars. Due to a significant number of restrictions, it was economically impractical to clear passenger cars, instead, there was no need to pay excise tax on trucks.
As a result, in 2013-2014, very few used passenger cars were brought to Ukraine, instead the demand was met by the import of cargo LCVs with mileage, which were later converted into passenger ones. A whole sphere of business was formed around this — Ukrainians converted several dozen LCVs in a day, and this happened almost on an industrial scale.
However, the laws were changed, and from January 1 , 2015, an excise tax was introduced on the import of used trucks, as well as on their conversion into passenger cars. After that, it seemed, the conversion service would become irrelevant. However, as statistics show, even though it became more expensive, Ukrainians continued to recycle trucks. Only from 2018 to the end of November 2023, Ukrainians registered more than 91,000 conversions of vehicles: the majority ( 54%, 49.2 thousand) remained trucks, 45.2 % (41.2 units) were or became cars, the rest 0.8% (772 units) were made by buses.
During this time, vehicles changed their destination the most in 2019 — 23,400 such operations were recorded. In the "covid" year of 2020, the volumes decreased by almost half — to 14.4 thousand, and the lowest number was in the difficult year of 2022: 8.3 thousand. In the first 11 months of 2023 , 11,600 cars were converted.
What car models are most often converted?
Most often, it is cargo LCVs that change their type — that is, the so-called "beads" and "pies". They are converted into cars by installing windows, seats and all other attributes of a vehicle that carries passengers, or they are adapted for special use by installing additional equipment. So, a cargo minibus can become a passenger or cargo-passenger van, a platform for transporting goods or a tow truck, a refrigerator, a residential van or a hearse.
The "universal" Mercedes-Benz Sprinter became the leader in conversions. From 2018 to November 2023, 8,200 such operations were registered. In second place was Renault Traffic (3.6 thousand), and in third place — Volkswagen Transporter (3.3 thousand).
Mercedes-Benz Vito (2.4 thousand) and Opel Vivaro (2.3 thousand) were also among the top five most popular vehicles converted since 2018.
- Mercedes-Benz Sprinter — 4,973 units.
- Renault Traffic — 3,310 units.
- Volkswagen Transporter — 2,828 units.
- Mercedes-Benz Vito — 2,400 units.
- Opel Vivaro — 2,254 pcs.
- Renault Kangoo — 1,723 units.
- Renault Master — 1,163 pcs.
- Volkswagen Crafter — 910 pcs.
- Volkswagen Caddy — 889 pcs.
- Ford Transit — 708 pcs.
How does the conversion industry work today?
" Senator Avto " LLC has been working in the field of minibus conversion for more than two decades. According to the companyʼs representatives, every third minibus in Ukraine is converted by their team, and in times of greatest demand, the company successfully converted up to a hundred minibuses in one day. As the owner of the company Senatorov Denis Mykolayovych noted in the comments of the Institute of Auto Market Research, for more than 20 years of the companyʼs operation, the demand for minibus conversion services directly depended on changes in the legislation regarding the conditions and cost of customs clearance of cars, because this had a significant impact on the final cost of the vehicle in Ukraine.
According to the head of "Senator Auto", the introduction of the excise tax on LCVs from January 1, 2015 did not significantly affect the companyʼs activities, since from the moment of its establishment, it aimed to provide customers with conversion services quickly — within one working day, and at the same time — with high quality, using extensive experience in this field. Therefore, the business managed to adapt: if earlier the company actively converted minibuses for their further use for personal purposes, after the changes in the legislation, the vast majority of projects concern the commercial use of cars.
In addition, Mr. Denys notes, some enterprises that worked in this segment of the auto business felt a certain negative impact due to the innovations, while others were forced to close or change their profile altogether.
In the first months of the full-scale invasion, the activity practically stopped, the company made only separate orders for volunteers and the Armed Forces of Ukraine. Over time, the demand for services increased again, but the market also experienced certain transformations. Today, the main volume of Senator Auto projects is focused on the conversion of minibuses, which are later used for commercial purposes for the transportation of passengers, tourist buses and other similar applications. The service of converting minibuses into motorhomes (so-called campers) has become extremely popular, and there is a steady interest among customers from Europe.
Thus, it can be stated that in Ukraine for more than 10 years there has been a separate field of auto business — the conversion of cargo minibuses into passenger cars, buses and even car builders. The business experienced various events and transformations due to the change in customs clearance rules, but the conversion industry was most affected by the onset of a full-scale invasion. The business had to adapt and look for new sales markets. Such have become the countries of the European Union, where the leaders of the field export minibuses converted into car dealerships.
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