According to registration data reviewed by Reuters and interviews with five industry insiders, tens of thousands of cars are being exported from China to Russia through “gray market” schemes. These schemes are typically aimed at circumventing sanctions imposed by Western and Asian governments, as well as commitments by car manufacturers to withdraw from the Russian market.
Since Russia’s invasion of Ukraine in 2022, the EU, the US, Japan, and South Korea have successively implemented bans on car exports to Russia, usually prohibiting the sale of luxury vehicles, high-displacement cars, and all electric and hybrid vehicles above a certain threshold value (such as €50,000). However, from Toyota, Mazda to German luxury brands, these originally restricted brands have continued to thrive in the Russian market.
According to data and interviews from the Russian research institution Autostat, this is partly due to informal networks that allow Russian dealers to order vehicles through Chinese intermediaries.
Data and sources indicate that most vehicles are either manufactured in China (many international brands have joint ventures with local partners in China) or produced elsewhere and transshipped through China. An increasing number are zero-mileage “used cars” – new cars registered as sold by dealers or traders in China, then immediately deregistered and reclassified as used cars for export.
This practice allows car dealers and distributors to inflate sales figures, receive subsidies, and export excess vehicles. Zhang Aijun, an exporter who used to work for a car trading company in Sichuan, explained that classifying new cars destined for Russia as used cars eliminates the need to obtain approval from car manufacturers, making exports easier.
In China, zero-mileage used cars typically come with significant discounts; however, in Russia, they are priced similarly to new, unregistered cars. Dmitry Zazulin, Sales Director at Panavto-Zapad in Moscow, noted that many customers insist on buying Western brands, but currently, they can only be imported through parallel channels (unauthorized third-party trade routes).
Mercedes-Benz, BMW, Volkswagen, and other sanctioned car manufacturers have stated that they strictly prohibit sales to Russia and are making efforts to prevent unauthorized exports. Mercedes-Benz admitted that investigations into such practices are time-consuming and complex, requiring assistance from third parties. BMW has stated that they have instructed their Chinese retail department to “vigorously oppose any potential exports to Russia,” and any vehicles entering Russia against their wishes are beyond their control.
A dealer in Vladivostok, named Vladimir, told Reuters that he does not keep restricted foreign cars in stock but instead purchases them from Chinese traders based on customer orders. Autostat data shows that imports from China of western or Japanese brand vehicles registered in Russia are increasingly dominant.
Since 2023, the number of such vehicles manufactured in China has more than doubled. In 2025, nearly half of the approximately 130,000 vehicles from sanctioned countries (i.e., countries where automotive bans were imposed on Russia such as Germany, Japan, and South Korea) sold in Russia originated from China. Since the outbreak of the war in 2022, over 700,000 of such foreign brand vehicles have been sold in Russia.
Last year, Russians purchased more Toyota vehicles than any other foreign brand except Chinese brands. However, Toyota stated that it stopped shipping new cars to Russia from 2022 onwards. Mazda also clarified that any new cars sold in Russia are resold by third parties beyond their control.
German cars are also highly favored. Autostat data reveals that nearly 47,000 new vehicles from the BMW, Mercedes-Benz, and Volkswagen Group were registered in Russia last year, including Audi, Porsche, and Skoda. Over 20,000 of these were from China, while the rest were from Europe, although analysts suggest many European-made vehicles likely passed through China to enter Russia.
Mercedes G-Class, popular among Russia’s elite class with a price tag of around €120,000 ($142,700), is solely produced in Austria. Dozens of shipping documents reviewed by Reuters show that German luxury SUVs like Mercedes GLC 300 and BMW X1 are continuously being imported from China to Russia.
Automotive industry analyst Felipe Muñoz stated, “Considering the significant growth in car trade between China and Russia in recent years, a clear conclusion is that many cars imported from Germany to China eventually flow into Russia.”
Currently, the Chinese Ministry of Commerce and the Russian Ministry of Industry and Trade have not responded to Reuters’ requests for comments. Both sides have previously stated their opposition to unilateral sanctions.