Azerbaijan.US
Recent increases in fuel prices are expected to affect Azerbaijan’s automotive market, potentially leading to higher vehicle prices, though without a sharp drop in consumer demand, according to a local economic expert.
Speaking to Yeni Sabah, social and economic analyst Ilgar Huseynli said the fuel price hike approved by the Tariff Council is unlikely to significantly weaken purchasing power in the short term, but will have indirect effects across the car market.
“From a consumer perspective, the current increase in fuel prices is not large enough to drastically reduce demand,” Huseynli said. “However, higher fuel costs will inevitably raise transportation and logistics expenses.”
He noted that the majority of used vehicles imported into Azerbaijan are transported by diesel-powered car carriers, many of which travel long distances, including routes from Georgia. As a result, higher diesel prices are expected to translate into increased import costs, which may be reflected in vehicle prices.
According to the expert, demand for electric and hybrid vehicles had been growing, but this trend may slow after customs duties on hybrid and electric cars were raised from January 1. Huseynli said the higher duties are likely to push prices up in that segment as well.
“The increase in customs duties means that electric and hybrid vehicles will also become more expensive,” he said.
“At the same time, newer vehicles with more recent production years are expected to rise in price by approximately 4,000-5,000 manats.”
Huseynli believes these changes may create a temporary price balance in the market. With fuel prices rising moderately and electric vehicles becoming significantly more expensive, buyers may reconsider their options, weighing higher upfront costs against long-term fuel savings.
Despite these adjustments, the expert described Azerbaijan’s car market as stagnant, attributing limited activity to declining household purchasing power rather than fuel prices alone.
As previously reported, fuel prices in Azerbaijan increased on January 1. Under the Tariff Council’s decision, the price of AI-92 gasoline rose by 5 qepiks, while diesel fuel increased by 10 qepiks.
