Why Kazakhstani consumers tend to buy particular brand and based on which insights?

RESEARCH IN CONSUMER BEHAVIOR:

Customer preferences in automobile brand: why Kazakhstani consumers tend to buy

particular brand and based on which insights?

Prepared by:
Adina Negmetova, ID 20202400
Aigerim Dostiyarova, ID 20211500
Anel Zhetybayeva, ID 20211395
Diana Dyussenova, ID 20211513

MKT5124 Consumer Behavior

MKT5203 Consumer Behavior and Marketing Strategy
Instructor: Azamat Gimranov

Almaty, 2021

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
TABLE OF CONTENT
TABLE OF CONTENT ..................................................................................................................2
ABSTRACT ....................................................................................................................................3
INTRODUCTION ...........................................................................................................................4
LITERATURE REVIEW ................................................................................................................7
METHODOLOGY ........................................................................................................................16
RESEARCH FINDINGS AND ANALYSIS ................................................................................17
Quantitative results ....................................................................................................................17
Qualitative results ......................................................................................................................21
LIMITATIONS .............................................................................................................................23
CONCLUSION .............................................................................................................................24
RECOMMENDATIONS ..............................................................................................................25
APPENDIX ...................................................................................................................................26
Appendix 1 – Questionnaire ......................................................................................................26
Appendix 2 – Questionnaire results ..........................................................................................30
Appendix 3 – Preliminary interview questions .........................................................................34
Appendix 4 – Interview transcripts ...........................................................................................34

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
ABSTRACT

The research paper aims to determine why Kazakhstani consumers tend to buy particular
vehicle brand and which insights stand behind the decision. Study focuses and assesses three
different hypotheses through the qualitative and quantitative method tools. A number of industry
players share own expertise and internal perspective on the stated topic. These data is compared
to first hand survey results covering mainly two capitals’ citizens of variety living standards.
Upcoming findings demonstrate unexpected perspective on mentioned industry customer
behavior.

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
INTRODUCTION

The amount of sparkling new cars on the road has long distinguished Kazakhstan's roads
from those of the previous 10 years. However, in Soviet times, the population did not have such
an opportunity: there was a shortage of cars, a minimal choice of automobiles, a lack of choice of
distributors and manufacturers and different payment methods. People were forced to travel to
neighboring countries to get a car from a landfill and use it in their home country. At that time the
industry position was deplorable. Today the automotive market is one of the most dynamically
developing areas.
More than 10 years ago, the majority of Kazakhstani motorists preferred the secondary
market, used automotive products from Europe and Japan, since cars from salons were not
affordable for the population. In general, in the roads, there were lots of smoke-billowing Soviet-
and Russian-made wrecks or wheezing Japanese castoffs. Individual customer preferences of
residents of Kazakhstan shift throughout time. The quantity of purchasing power for an automobile
depends on the individuals' useful income and savings, also from external factors.
The history of the domestic auto industry dates back to 2003, when the first NIVA car was
produced. Then the volume of production was only a few thousand units. The product line was
represented only by VAZ cars and the main part of the country's car market was occupied by
imports. A key development stage with specific commitments for enterprises started with the
signing of the first agreements on the industrial assembly of motor vehicles in 2010.
Large investors, such as SaryarkaAvtoProm LLP and Astana Motors represented by Nurlan
Smagulov, were involved in the development of the industry. All this became possible due to new
approaches to the development of the industry, the introduction of incentive programs. As for the
production of commercial equipment, global players have begun to be attracted to the country.
The first large manufacturer to come to Kazakhstan in 2005 was KamAZ. Then such brands as
Daewoo, Hyundai, IVECO, ANKAI and many others opened their production facilities. As a
result, in a short time, an entire industry was created with tens of thousands of jobs, taking into
account related industries, regularly replenishing the budget from tax deductions.
On the other hand, there were several external factors that caused a crisis in the auto market,
these are:
− Tenge devaluation in 2014. The fall of the ruble and the decline in car loans led to
an increase in parallel imports from Russia. The share of parallel imports among all registered new
cars in 2014 was 50%. As a result, large residues in warehouses were formed in Kazakhstan.
− Falling oil prices in 2014.
− The decline in the solvency of the population that followed.

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
− Increase and introduction of taxes and fees that increase the cost of purchasing a
car registration.
In view of the above-mentioned situation, the determining factor for Kazakhstani car
buyers was the price, not the brand.
The stabilization of the industry situation has become possible thanks to the consistent
position of the state in the development of the automotive industry. As a result, Kazakhstan’s car
factories have significantly expanded the range of models produced, and the consumer has
received new, more profitable opportunities to buy domestic cars within the framework of existing
state programs.
On April 20, 2015, the implementation of the preferential lending program began, which,
as previously reported, was launched as part of the Presidential Initiative "Nurly Zhol". 20 billion
tenge was allocated from the National Fund to support Kazakhstani automakers and stimulate
consumer demand in the country's automotive market, the effective interest rate on a loan for the
purchase of a domestic car did not exceed 7.5%.
On May 31, 2019, the National Bank of the Republic of Kazakhstan launched a Program
of preferential car loans. According to the terms of the program, residents of Kazakhstan could get
a loan through second-tier banks for the purchase of a locally produced passenger car at a nominal
rate of 4%.
Consumer expectations and behaviors are not the same. So that, the study endeavors to
identify the factors influencing the buying behavior of the people based on the factors such as
lifestyle, economic situation, occupation, age, personality and self-concept car owners which is
important for marketer and researchers.
Consumer behavior of buyers is also influenced by human psychology. A consumer's
fundamental necessities and security demands can drive them to purchase various types of
automobiles. Car owner’s impression has a significant impact on consumer’ purchasing decisions.
Moreover, they can be impressed by creative product advertisement and change their mind and
buy another vehicle.
Likewise, cultural features have a strong influence on the buyer's decision. This factor
includes the basic values, needs, desires, preferences, ideologies of a particular community or
group of people. In short, culture in a person's life answers the question, who is he / she and how
he / she will act? This factor makes it easy for companies to offer a product that a customer wants.
Like culture, social factors influence consumer behavior, shaping the needs and desires of
customers. For centuries, people have been divided into classes and communities where they have
their own common preferences and views. For instance, they have similar financial stability, live
in lonely conditions, and drive similar cars. Also, one of the social factors is the family, or rather

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
the marital status. A man who is young and single will choose a sports car like Mercedes E63 to
impress his peers. And married couples prefer comfortable and large cars as Toyota Alphard so
that the whole family can get there in comfort.
Focusing attention on local market customer preferences, important to mention the fact of
measurable development of the automobile industry within Kazakhstan for the past decade. This
fact certainly widens the citizens' choice option and pulls the interest for further study. However,
current COVID crisis should have been cause significant shift of just opened consumer appetite,
that makes the topic of research even more demanding.
Hence, the following hypotheses related to Kazakhstani buyer preferences in a particular
car brand have been suggested and tested:
1. Korean brands as Hyundai or KIA as a good quality provider connected with an
affordable price tag
2. Toyota as a common local trend of presenting own wealth
3. Economy segment brands, like Daewoo or LADA, for using to get revenue from
shared economy, particularly taxi services.

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
LITERATURE REVIEW

The literature review depicts a variety of studies conducted in the context of customer
behavior in the automobile sector.
Primary data, according to Kotler (2005), is the acquisition of original data by a
researcher for a specified goal. It is a data that did not previously exist and that is collected for the
first time for a specific purpose, for example, through customer surveys.
The primary data will be gathered by using Interview Method to automobile industry
authorities and through distribution of questionnaire to different individuals to have a mixed
number of participants representing the buyers from different parts of Kazakhstan with different
educational backgrounds, age groups, and pattern of purchasing.
Primary data preparation and implementation is substantially more time demanding than
secondary data.
According to Babbie (2003), knowledge how to interpret quantitative data in the form of
numeric data is required in the practice of social research where a quantitative method is used.
In our case, we used the primary resources for analysis by reading articles on the official
automakers and financial sites. So, based on the huge flow of information that was collected, we
came to the conclusion that, today the market is developing rapidly. The client changes with it.
And these changes are happening so quick that the market sometimes does not keep up with them.
There is only one thing left – constant study of a consumer. The concept of “consumer behavior”
is of prime importance in marketing and has evolved over the years.
According to Philip Kotler (2005), the creator of Marketing as a scope of academic study,
consumer behavior is the study of how individual, groups and organization select, buy, use and
dispose of goods and services, ideas or experiences to satisfy their needs and wants.
As per Quester (2007), define consumer behavior as “those acts of individuals directly
involved in obtaining, using, and disposing of economic goods and services, including the decision
processes that precede and determine these acts”.
In this case it is very important to understand customer behavior as it plays an important
role in the purchase of a particular brand car.
Philip Kotler argues that segmentation means recognizing that you cannot serve all
customers with the same level of satisfaction. Thus, in order to ensure maximum satisfaction, it is
necessary to define a target market, which consists of a set of buyers who have common needs
and/or characteristics compared to those that the company or organization decides to serve.
Representatives of the target audience of the automotive sector are individuals of completely
different fields of activity, demographic characteristics and personal preferences. The

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
overwhelming majority of target market people are of working age, decision makers, middle and
senior managers of various departments and organizations.
For most people, buying a car is the second most important and expensive decision, the
first is buying a house. So, it is very important for manufacturers to create a positive brand image
that will help companies in the future as consumers can make repeat purchases of the vehicle.
Human needs are increasing day by day, and car models are no longer an exception to this
behavior. Consumer behavior is a rather complex process, which is influenced by a combination
of economic, technological, political, cultural, demographic and natural factors, as well as the
characteristics of the car, which is reflected in the purchasing attitude, motivation, perception,
personality, knowledge and lifestyle.
According to the world statistics, we know that China is a manufacturing country. Almost
every three cars on the planet were made in China. The period from 2019 to 2021 was very difficult
for everyone, "Celestial Empire" and many auto-produce companies, because in the beginning, in
order to reduce costs, they had to lay off more than 80 thousand employees, and then completely
closed factories due to quarantine measures. Due to the COVID-19 pandemic in February 2020,
car sales fell 79% compared to the same period last year, in March by 49%. In Spain, Italy,
Germany and the UK, Auto dealer sales declined from 40% to 80% in March. Although the whole
world is faced with a crisis in the auto business, to a great surprise, the deficit and price growth
did not affect the purchasing power of Kazakhstanis market. From January to August 2021, car
companies sold 76 thousand new cars, which is 40% more than in 2020.
Based on various articles and studies, some conclusions can be made on why car sales in
Kazakhstan were higher than in other countries. First, in terms of sanitation and hygiene, a private
car is safer than public transport. Secondly, the forced refusal to travel to distant countries allowed
families to save up for a down payment for buying a car, moreover, all leading car dealers actively
use financial instruments so that a client can buy a car on credit. But due to such an unexpected
influx of buyers, dealers at first in the premium and mass segment were faced with a shortage of
cars in warehouses. This was due to the fact that many distributors reduced the number of
deliveries of machines. Obviously, everyone expected at least a sharp decline in demand, as
happened all over the world. But Kazakhstani consumers shocked the market with their desire to
buy a car during the crisis. Many market representatives assume that if it had not been for the
summer deficit, the market would have shown even greater sales results.
After reviewing the latest financial analysis and forecasts, we have come to the conclusion
that many auto-companies will change their strategy. In accordance with Kotler (2005), all
generation types such as X, Y and Z have different insights that effect on their buying behavior.
Because Gen Y is already fading into the background, and Gen Z is becoming the center. Because

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
of this, many auto producers have decided to adapt to Gen Z and make social changes. The new
cars will be environmentally friendly and charge as quickly and easily as phones. Such colossal
changes will be made, because in 2020 40% of consumers will be generation Z, so they simply
have no choice to stay afloat.
However, Kazakhstani consumers have not yet reached this level, so they are not so picky,
and choose cars based on their financial capabilities or social values. If you go to the Lexus center,
which is considered a luxury class in the Kazakhstani market, you will not see such a large
selection of cars as 3 years ago. As mentioned earlier, the companies reduced the production and
supply of cars, and only 4-5 cars remained in the car center. But when you ask consultants, is that
all you have to offer? They will say that this is all that is left (and they are on bail), many have
already made orders and are waiting for them to be brought from the factories.
The research topic focuses on examining customer attitudes and perceptions, which
necessitates the use of several types of data collection methods to aid in better understanding and
forming conclusions.
Secondary data was gathered from a variety of sources, including past studies, websites,
and internet sources, all of which are relevant to the study's requirements and aid in the
construction of the research's foundation. Professional reports and analyses available on the market
from organizations that excel in the subject of study can also be referred to using the data collection
approach. 2007 (Bryman and Bell).
According to Glass (1976), secondary data analysis is defined as “the analysis of data by
researchers who will probably not have been involved in the collection of those data, for purposes
that in all likelihood were not envisaged by those responsible for the data”.
Apart from collecting primary data, the ideology of combining data from various sources
and studies has been generally recognized since 1960 (Bryman and Bell, 2007). For data collecting
and model creation, the researcher consults a number of articles in the domains of management
and statistics, as well as websites.
Today, the automobile industry of Kazakhstan is included in the list of 12 priority areas for
the industrial development of the non-resource sector and is an object of consistent state support.
Over the last ten years, the Republic of Kazakhstan's automobile market has evolved very
differently. Let us study historical peaks and external variables that influenced purchasing power
of Kazakhstan residents in order to fully comprehend the car market.
According to Association of Kazakhstan Automobile Business Car sales in Kazakhstan in
2013 exceeded all forecasts. That year, Kazakhstan has confirmed its status as one of the fastest
growing automotive markets in the world, taking 4th place among the top ten countries in this
growth category. In 2013, almost 163 thousand new cars were sold.

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
Then there were several external factors which we mentioned above in our introduction
part that caused a crisis in the auto market.
According to PricewaterhouseCoopers’s overview of the automotive market of Kazakhstan
for July, 2015 there are some quotes from the strongest industry players, regarding the market
situation: «In 2014, a sharp decline in oil prices hit the currencies of Russia and Kazakhstan. But
in terms of the depth of devaluation, the ruble has doubled the tenge. The result was an outflow of
customers of Kazakhstani car dealerships to the border regions of Russia and a 13-month reduction
in the market of civilized autoretail in our country. Moreover, since the beginning of this year, this
process has accelerated with the abolition of VAT and excise taxes for individuals who import a
car from Russia and Belarus to Kazakhstan. Only following the results of 4 months since the
beginning of 2015, the Kazakh traffic police authorities have registered more than 135 thousand
passenger cars imported by parallel dealers... » Yerik Sagymbayev, President of the Asia Auto Car
Assembly Plant JSC ” (PwC, 2015).
«...The influence of external factors turned out to be much stronger than we expected. We
were not prepared for the collapse of the ruble.
According to our preliminary estimates, the share of parallel imports among all registered
new cars in 2014 was 50%. As a result, we have formed large balances in warehouses. Our
response to the increased imports from Russia was the lowering of prices in Kazakhstan. We
expect the situation to improve in the near future...» Etsuo Hasino, President of Toyota Motor
Kazakhstan (PwC, 2015).
«At the moment, our company has tried to minimize the price difference with Russia for
all our brands as much as possible. With further devaluation of the ruble, we will continue
negotiations with manufacturers, we will defend our position and protect our interests...» Anton
Afonin, Executive Director of Astana Motors (PwC, 2015).
«The biggest threat comes from factors beyond our control: devaluation, open borders,
technical regulations, which in fact can break our market. This year has taught me one thing – you
need to always keep yourself in good shape and analyze the decisions made...» Andrey Lavrentiev,
Chairman of the Board of Directors and Shareholder of the Allur Group of Companies (PwC,
2015).
«The next logical step in Kazakhstan will be the development of the official used car
market, we have already observed this trend in countries with more developed economies, and
there are a number of reasons for this...» Bertrand Gossard, Director of Retail Business
Department, Eurasian Bank (PwC, 2015).
«The Trade-in program has not yet brought success in the local market. It takes time for it
to be perceived by our customers in the right way. After all, it is beneficial both for the client and

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
for us. Since the cars of our brands (Toyota and Lexus) have a high residual value, which means
that the customer pays less for a new car in the next 2-3 years. Today we are trying to promote this
product in the market of Kazakhstan ...» Etsuo Hasino, President of Toyota Motor Kazakhstan
(PwC, 2015).
On April 20, 2015, the implementation of the preferential lending program began, which,
as previously reported, was launched as part of the Presidential Initiative "Nurly Zhol". 20 billion
tenge was allocated from the National Fund to support Kazakhstani automakers and stimulate
consumer demand in the country's automotive market, the effective interest rate on a loan for the
purchase of a domestic car did not exceed 7.5%.
The stabilization of the oil market and the President's statements made it possible to reduce
the devaluation risks of the population by the 2nd quarter of 2015. High oil prices have allowed
the country to increase its gross international reserves, which have remained stable since the end
of 2014.
In 2016, the exchange rate entered a relatively predictable corridor, these factors provided
a start to the recovery of the automotive market in monetary terms. In 2017, the automobile market
of Kazakhstan made a turn to growth after a prolonged recession in 2014-2016. As mentioned
earlier, new passenger car sales in Kazakhstan decreased by 3.6 times during this challenging
period for the country's economy.
The stabilization of the industry situation has become possible thanks to the consistent
position of the state in the development of the automotive industry. As a result, Kazakhstan’s car
factories have significantly expanded the range of models produced, and the consumer has
received new, more profitable opportunities to buy domestic cars within the framework of existing
state programs.
2018 and 2019 were the next successful years for automotive retail in Kazakhstan.
On May 31, 2019, the National Bank of the Republic of Kazakhstan launched a Program
of preferential car loans. According to the terms of the program, residents of Kazakhstan could get
a loan through second-tier banks for the purchase of a locally produced passenger car at a nominal
rate of 4%.
Therefore, in 2019, 49% of cars purchased by Kazakhstan residents were cars of domestic
assembly. As we can see, the growth is evident, and there is a considerable contribution of the
ongoing state program of preferential lending of cars of Kazakhstan assembly.
According to the data of the analytical Agency "AUTOSTAT the results of sales in 2019,
the market volume of new passenger cars in Kazakhstan amounted to 68.9 thousand units, which
is 27% higher than in 2018

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?

Figure 1: Segmentation of Kazakhstani car sales in 2019 and top-10 sales models.

Toyota Camry, Lada, Hyundai, KIA, and Renault were among the most popular local
passenger car models purchased in 2019. (Figure 1).
According to the Statista 2021 database, LADA was most sold brand in the passenger and
light commercial vehicles market of Kazakhstan in 2019. Toyota and Chevrolet followed it with a
two-percentage point difference in the sales share, each accounting for 20 percent of the total.
(Figure 2).

Figure 2: Distribution of passenger cars and light commercial vehicle sales in Kazakhstan in
2019, by manufacturer (source: Statista)

No matter how unexpected it may sound to many, but the Kazakh car market has grown a
little in 2020, once again confirming that our people buy cars even in a crisis.

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
After the spring lockdown in May 2020, the market revived, and the sales level began to
recover. This was largely due to the delayed demand – people who could not go abroad to rest
because of the pandemic, many spent on buying a car.
According to the CEIC database figure 2, Kazakhstan Motor Vehicles Sales recorded
101,663 units in Dec 2020, compared with 78,192 units in the previous year. Kazakhstan Motor
Vehicles Sales is updated yearly, available from 2005 to 2020, with an averaged number of 62,452
units. The data reached an all-time high of 165,710 units in Dec 2013 and a record low of 29,000
units in Dec 2010. (Figure 3).

Figure 3: Kazakhstan's Motor Vehicles Sales from 2005 to 2020 (source: CEIC Data)

According to the Association of Kazakhstan Automobile Business (AKAB), sales of new

cars in August 2021 compared to August last year showed a decrease (-5.4%) to 9,093 units. (8,734
units of passenger cars and light commercial vehicles and 359 units of trucks and buses). Chevrolet
continues to lead the top ten brands in August – 2,196 units, Hyundai is on the second line with a
result of 1,561 units, Toyota returned to the third position – 1,012 units.
Dealers Kia sold 825 cars in August. The top five best - selling brands closes Lada – 716
units+. Volkswagen continues to secure the sixth place (356 units), Nissan (331 units) is on the
seventh. Next on the list: JAC (328 units), Renault (308 units) and BMW (114 units).
TOP 10 most popular models in August 2021: Chevrolet Cobalt – (1,330 units), Chevrolet
Nexia – (542 units) and Hyundai Accent - (499 units). Next on the list: Toyota Camry(437 units),
Hyundai Elantra (326 units), Lada Largus (282 units), Hyundai Sonata (255 units), Hyundai
Tucson (243 units), Kia Rio (243 units), Toyota Rav4 (213 units). (Figure 4).

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?

Figure 4: Sales of new cars in August 2021 in Kazakhstan (source:AKAB)

More than 10 years ago, the majority of Kazakhstani motorists preferred the secondary
market, used automotive products from Europe and Japan, since cars from salons were not
affordable for the population. Now the trend has changed a little and Russian car, Korean models,
as well as cars that are assembled in Kazakhstan compete with the old "Europeans" and "Japanese"
in price. The local car industry has been developing rapidly in the last 5-7 years, delighting with
the quality and comfort of the models produced. It is also unprofitable to import cars to the
Eurasian Economic Union due to high customs duties.
The dynamics of sales in the Kazakh market will also depend mainly on the situation with
the coronavirus pandemic and the timing of the lifting of quarantine measures. Lockdown,
quarantine measures in many regions and subsequent disruptions in the supply chains of cars have
led to a shortage in the market. Automakers have not yet been able to produce commercial vehicles
in sufficient quantity to fully meet current demand, delivery times are now much longer than they
were before the pandemic.
The spread of the coronavirus has forced dealers to take a fresh look at car sales. So, car
dealers started trying to translate sales online. The main plus of online buying or booking a car is
the price. Car dealers have prepared several options for contactless purchases. One of the first who
decided to experiment with online sales was the BIPEK Auto Kazakhstan company. They
organized a chat on the website where their consultants help to choose a car and equipment.
Further, a contract is concluded remotely with the client, he transfers the money to the dealer's
account, and after their receipt he can pick up the car. Thus, you can buy Kia, Škoda, Lada, UAZ,
as well as Renault. The scheme of work of Allur Auto dealers is slightly different. The company

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
offers to leave an application on the website for the car brand and model which you are interested
in. After the manager processes the information, the desired car should be brought for a test drive
straight to the buyer's house. If the customer likes the car, the client will be offered to fill out the
documents and pay for the purchase by translation. Thus, the pandemic had a positive effect on
the introduction and development of online sales in the car sector, which allowed dealers to
maintain a sufficient number of sales.
In addition to the above reasons for the stability of the car market, based on statistical data,
we believe that the well-coordinated work of the car industry and even greater activity of the state
played a large role. As the government has not only increased investments, but also increased job
places. Producing mechanical engineering goods growth of more than 31.7% if we compared with
the previous year. The increase was due to the production of vehicles, trailers and semi-trailers,
and the production of other vehicles.

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
METHODOLOGY

The research paper aims to understand consumer behavior in response to automobile brand.
In particular, what are the main reasons and drivers standing behind the choice. In order to assess
the mentioned topic, two types of methods have been applied - qualitative and quantitative.
The first, quantitative approach, was conducted among Kazakhstani vehicle customers.
The method noted for a comparably rapid data gathering and maximized randomness in responses.
So that, the bias level can be diminished. Conducted survey consisted of a standardized and a few
open-ended questions to get the deeper answers on some points. Moreover, more accuracy can be
assured to create generalizations on the subject matter.
Survey has up to 20 questions to keep respondents involved in participating survey.
Formed sample size was pretty big to distinguish the behavior of as much customer categories as
possible. However, attention to the three big cities' buyers was emphasized as the ones where the
most population concentrates.
Despite the number of advantages, quantitative method does not provide "follow-up"
option and return to a respondent to clarify some facts. There is still a risk of wrong conclusions
and making false correlation with a general population trend in consumer behavior. So, to balance
these cons one more, qualitative, approach was conducted during the research.
As a qualitative method, authors have picked the interview of a number of industry
representatives. During the interview, reporter has a chance to gather in-depth information and
pursue the hunches. The clarification is granted and more open-ended questions are given. In
addition, the initial path can be corrected while the interviewee provides more insights on research
topic. For sure, the official information can be considered confidential and not disclosed by a brand
stuff during the survey. As well, not every company opens for comparably small sized research
organized by university students.
Interview questions were formed to get as well as first-hand statistical data as more deep
information on changing consumer demands and effects of recent worldwide events on their
behavior. Likewise, the perspective of brand counselor on developed research hypotheses backed
by internal industry understanding.

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
RESEARCH FINDINGS AND ANALYSIS

Quantitative results

The survey conducted within almost two weeks, starting 2nd of December and ending 15th
of December, covered 174 Kazakhstani citizen.
Both male and female were involved. As it Q1: Indicate your gender
is presented on Figure 1, Male counted for 52.87%
against 47.13% of Female answerers. Female
47.13%
Each age group was covered, so that 52.87%
Male
customers from 25 to 34 counted for 37.93%,
younger age group of people counted for 28.87%
Figure 1
and the rest built roughly 34%.

Q2: Indicate your age Q3: Indicate your region

4.02%
4.60%
45+ 10.34% 2.87% Almaty
12.07% East Kazakhstan
35-44 22.99%
West Kazakhstan
25-34 37.93% 66.67% Nur-Sultan
8.62%
North Kazakhstan
0-24 28.74% 1.15% Shymkent
0 20 40 60 80 South Kazakhstan
Figure 2 Figure 3

Figure 3 reflects the affiliation by major cities and regions. More than a half, 116,
respondents are from Almaty. The next major indicator allocates to Nur-Sultan, 21 responses. The
next following representatives are from West Kazakhstan and Shymkent, 8.62% and 4.02%
correspondingly.
Q4: Indicate your monthly income

1 000K KZT + 9.77%

500K – 999K KZT 14.37%
300K – 499K KZT 22.41%
200K – 299K KZT 24.14%
0 – 199K KZT 29.31%
0 10 20 30 40 50 60

Figure 4

Different monthly income level respondents were involved in the questionnaire. 76% or
132 of them have monthly income less than 500K KZT. 25 answerers get between 500K – 999K
KZT and 17 receive more than one million tenge per month.
More than a half, 93 participants, drive car regularly. Within those people, 79 or 85% own
the car they drive. The rest 14 use the car owned by family member or employer. Mainly, taken
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Why Kazakhstani consumers tend to buy particular brand and based on which insights?

Q5: Do you drive a car regularly? Q6: Do you own the car you drive?

15.05%

Yes Yes
46.55%
53.45% No No

84.95%
Figure 5 Figure 6

car belongs to relatives rather than an

Q7: Who owns the car you drive?
organization, 78.57% against 21.43%. There are 15 78.57%
no respondents, who takes car from car sharing 10
5 21.43%
services for daily routine. 0
Car sharing Employer; Family
Participants, who do not drive car services entity member;
relatives
regularly or have currently no car, demonstrated
the willingness to buy one. Figure 8 reflects Figure 7

these numbers. There are 65 potential vehicle Q8: Do you plan to buy a car?

customers accounted for 68.42%. Out of them, 31.58%

75.4% plan to make purchase next year or Yes
No
beyond. The rest 16 mentioned in Figure 9 68.42%
going to buy a vehicle within a year or less.
Numbers are 16.92% and 7.69% accordingly. Figure 8

Focusing attention to the main question Q9: When do you plan to buy a car?
of the conducted survey, 147 out of all 100%
respondents indicated own vehicle brand 80% within following
6 months
preferences. 109 customers built top 5 brands 60%
within a year
led by TOYOTA. So that, the leader counted for 40%
next year and
29.25%, the next top brand, HYUNDAI, 20% beyond

combined 18.37%, LEXUS – 10.20%, KIA – 0%

8.16% and the last VOLKSWAGEN makes up Figure 9

Q10: What brand is (would be) your car?

50
40
30
20
10
0

Figure 10

18
 Why Kazakhstani consumers tend to buy particular brand and based on which insights?
6.12%. The rest 27.9% of answers gained less than 5% each. The ranking closed by MAZDA,
PEGEOT, PORSCHE, RENAULT, SUZUKI and TESLA, each forehead mentioned autobrand
gained one point or 0.68%.
According to Figure 11, the superiority, 89 or 60.5%, use the car to commute to work. The
next two needs are leisure activities
Q11: The main reason to use the car?
(21.7%) and taking children to school
Shopping
(10.2%). Only 10 customers (6.8%)
Source of income; business
utilize a vehicle as a source of income.
Taking children to school
90% of those have income less than 500K
Leisure activities
KZT per month. There was only one
Commute to work
respondent, who defined the shopping as
0 20 40 60 80 100
common usage reason of a vechicle.
Figure 11

The rank of criteria

customer pay attention to
represented that safety is
the first on the list. Figure
12 shows the following
crucial features – quality,
price and fuel economy.
Further market demand on
the car or its reselling
options took middle
position in the rank.
Figure 12
Manufacturer company

Q14: Is your car new or second-hand? gets more attention from a buyer than a
capacity. Technical equipment and additional

27.85% features were assessed equally by survey

answerers, eights and ninth positions
Second-hand respectively. The styling of the car or its color
New
was mentioned as the least important criteria
comparing to others. The other criteria
72.15%
mentioned but not listed in the rank were
stated by the rspondents. Those included - type
Figure 13
of fuel; transmission; spare parts; clearance;

19
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
place of assembly; availablity in the salon; taxes; trunk volume; estimated delivery time; trade-in
option and passage on a dirt road.
The 79 car owners, who took part in the survey, indicated the freshness of the vechicle by
answering Question 14. The results, demonstrated in round table in Figure 13, demonstrates that
72.15% owns the second-hand car. There are only 22 person driving absolutely new car.
Those respondents Q15: What was the payment method to buy a car?
also defined the payment 80%
50
method of the purchase, the 60%

proportion of which can be 40%

19
seen in Figure 14. The 20% 10

preferred method is clearly 0%

Payment by installments On credit Cash
cash. Number was formed by
Figure 14
more than a half of answers or
50 out 79. 24.05% of owners paid on credit and 12.66% used payment by installments.
Within the ones, who used the
Q16: Which second-tier bank services did you use to
make a payment? second-tier bank to organize the
3.57% transaction, Sberbank recognized as
3.57%
3.57%
Sberbank
7.14% the most friendly one. 32.14% or 9
Halyk Bank
Kaspi Bank
respondents reached to their
32.14%
7.14% Eurasian Bank services. Halyk Bank and Kaspi
Bank CenterCredir Bank gained the same portion
21.43% Forte bank
equaled to 21.43%. Two answerers
21.43% Alfa-Bank
picked Eurasian Bank and the same
ATF Bank
amount referred to Bank
CenterCredit. The rest banks have
Figure 15
only one person, who used their
services for a car purchase and went under this survey.

Q17: For how long did you apply for an instalment

Within bank operated
plan/loan? transactions: 50% of payments by
more than 3 years installments were signed up to 1
from 1 to 3 years
year; 57.9% of credits formed for
from 6 months to 1 year
up to 6 months included more than 3 years.
0 5 10 15 Almost half, 33 or 41.77%, of
Figure 16 the car owners bought a vehicle

20
Why Kazakhstani consumers tend to buy particular brand and based on which insights?

Q18: When have you bought your Q19: Have you bought a car initially
car? planned?

41.77% 45.45%
58.23% 54.55%

during the pandemic before the pandemic Yes No

Figure 17 Figure 18

during the pandemic. 15 or 45.45% of them picked another model than planned initially. 8
respondents mentioned that absence of a car at salon influenced their decision.

Qualitative results

The first interviewee, official representative of the “Allur Group of companies” Zhiger
Azbergenov, mentioned that despite the pandemic, KPI was overfulfilled within the whole entity.
The organization has not stopped own operations thanks to some supplies in stock. The
organization modified own sales paths by adding online format that thereafter were kept in
business. Mr. Azbergenov strengths attention to the fact that the profit growth kept stable. Deeper
questions clarify, that group of companies took variety of actions to keep the client. However,
those are not related to the target group of this research paper. Nevertheless, at the end Zhiger said
that Kazakhstani people “managed to save their savings and direct them to the purchase of a car
for themselves and their family “. In that way, the thrift attitude of elderly people rejuvenated their
final buyer, who became their current audience.
The second interview participant represented Mycar.kz company. Damir Ismailov
expressed his opinion on some factors that affected the customer preferences along last year. Those
include deficit of new cars at the salon, public transport inefficiency, prices and availability of
Chinese newcomers. Head of Digital mentioned that idea of Trade-in has no chance to be
implemented under crisis circumstances and substantially is not working as there is no new cars
on market. There are still group of people, who have no changes in their behavior due to the wealth.
But the lower income citizens might shift to cheaper Chinese brands by Damir’s assumptions.
Interviewee expects the increase in the locally assembled automobiles, however as for now states
the top brands in Kazakhstan as Chevrolet, Hyundai and Toyota.
The biggest and deep interview was taken from official KIA distributer in Kazakhstan,
Evgenyi Shumkov. According to the Head of Marketing, current market situation can be defined

21
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
as the “vendor market” that came after 10-13 years of “consumer market”, when the customer
dictated the needs because of variety of options availability. Market changed too fast. Two factors
led “consumer market” – historically constant import of used cars and good appetite for new ones.
Pandemic enhanced the appetite of the buyers as the production decreased, demand keeps being
high. As the expert says, local market is developing towards the stabilization. The biggest hope
for governmental actions to keep the market conditions favorable so that industry players can keep
the designed path.
The last interviewee, Ratbek Bayenov, Kazakhstani blogger and car lover, also expressed
his opinion within semi-structured interview. Amateur pointed that there was a notable decline in
a new car production, that shifted demand for the second market. Official players made add-ins to
increase the price and came at least to break-even point. The main driver or criteria for the
customer in existing market conditions, according to Mr. Bayenov, is the price. Naming the top
brands in auto market, Ratbek listed Chevrolet as the most affordable vehicle offered under
governmental interest rates preferential program and then Hyundai and Toyota.

22
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
LIMITATIONS

The research paper was organized using all available possibilities, both human and
temporal. Despite this, the work done has a number of limitations that could, to a certain extent,
affect the results and conclusions drawn.
First of all, conducted quantitative survey had a limited number of respondents. Such small
portion of customers focused mainly in two big cities shall not represent the whole picture of
Kazakhstani auto consumer. The wrong correlation can be built with a general population trend.
The subsequent limitation is that preferences of citizens in comparably big cities with
different locations on the map have no chance to demonstrate the consumer behavior of Western
cities. Even the gathered results of Almaty and Nur-Sultan should be divided and considered
separately from each other to come to more precise insights.
In addition, the qualitative method, interview, that was taken from a four a kind of different
players are not balanced well. So that, some of the interviewees had greater expertise than others.
This fact could have lad authors rely on ones’ thoughts more than on other participants.
Another fact to mention is a short period of time to arrange deeper understanding of the
stated topic.
The last limitation is the lack of enough first-hand research analysis organized to test the
third assumption regarding a car as a source of income. Taken actions and the information got
could not be expressed within the research interpretation requirements.

23
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
CONCLUSION

Finalizing the work done and comparing the initially stated hypothesis with a shown result,
the following conclusions can be made:
The first assumption, “Korean brands as Hyundai or KIA as a good quality provider
connected with an affordable price tag”, is confirmed. The data gained within questionnaire and
the field experts present the high need of a balanced price-quality brand within the Kazakhstani
consumers. Particularly, HYUNDAI takes strong second position with any formed auto brand
rankings. However, starting from pandemic there is some shortages in the market of new cars. So
that, logistics issue can remarkably shift the customer preferences from Korean brands in
upcoming future if no changes made.
The second hypothesis that states “Toyota as a common local trend of presenting own
wealth” is confirmed too. Toyota as a car brand definitely have major stake in local buyers’
fondness. In spite of that, it is difficult to say, that the research findings clearly indicated whether
the brand associated with personal wealth or not.
The last formed hypothesis, “Economy segment brands, like Daewoo or LADA, for using
to get revenue from shared economy, particularly taxi services”, was not confirmed. There is no
clue, that assumption was not correct. There is still a need to organize and run the research paying
more attention to the involved participants to uncover the subtopic of particular audience. In that
way, currently there is an insufficient information gathered to understand major consumer
behavior in economy segment car brands.

24
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
RECOMMENDATIONS

Moving to the recommendations part, authors considered two sides of gained insights –
consumer and the vendor.
As there is a constant and even upcoming more increase in the demand to a personal
vehicle, Kazakhstani customer should better think about a car purchase if he planned one. The
projected addendum of the market with new cars will just turn the preferences of buyers and
balance the used-to-new automobile ratio. As the one of the experts said during the semi-structured
interview, the era on vendors is close. Distributor’s state own rules profitable for companies rather
than individuals buying from them.
Considering another side of the play, there are plenty of growth opportunities for business,
both first- and second-hand car market. As for the used car (re-)sellers, customer checks them
shelfs first to get the vehicle as soon as possible and close the unit of need. While for new auto
providers, the industry players only taking moderate steps to set up the production.
From both sides, market seems overheated with crisis happening and actions taken to
mitigate possible consequences.

25
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
APPENDIX

Appendix 1 – Questionnaire

This questionnaire is conducted as a part of the "Consumer Behavior" course at KIMEP

University by graduate-level students. The research aims to understand the consumer behavior of
Kazakhstani citizens in response to the automobile brand.
The following survey will take no more than 10 minutes to complete. Under no
circumstances are you obliged to answer any of the questions, however, doing so will greatly assist
in assessing the research focus.
All responses are recorded anonymously and used solely for academic purposes.
Thank you for taking your time and participation!

1. Indicate your gender

a. Male
b. Female
2. How old are you?
a. 0-24
b. 25-34
c. 35-44
d. 45+
3. Where are you from?
a. Nur-Sultan
b. Almaty
c. Shymkent
d. North Kazakhstan (Kostanay, Petropavl, Pavlodar, Karagandy etc.)
e. West Kazakhstan (Atyrau, Aktau, Aktobe, Oral etc.)
f. South Kazakhstan (Kyzylorda, Turkestan etc.)
g. East Kazakhstan (Oskemen, Semey, etc.)
4. What is your monthly income?
a. 0 – 199 K KZT
b. 200 – 299 K KZT
c. 300 – 499 K KZT
d. 500 – 999 K KZT
e. 1 MLN KZT and more
5. Do you drive a car regularly?
a. Yes
b. No
-----------------------------
If answer for Q5 is YES:
5.1. Do you own the car you drive?
a. Yes
b. No

If answer for Q5.1 is NO:

5.2. Who owns the car you drive?

a. Family member/Relatives
b Employer/Entity
c. Carsharing services
If answer for Q5 is NO:

26
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
5.3. Do you plan to buy a car?
a. Yes
b. No
5.3.1. When do you plan to make a purchase?
a. within following 6 months
b. within a year
c. next year and beyond
---------------------------------

6. What brand is it (would it be)?

a. AUDI g. KIA l. RENAULT
b. BMW h. LADA m. SKODA
c. CHEVROLET i. LEXUS n. TOYOTA
d. DAEWOO j. MERCEDEZ- o. UAZ
e. HYUNDAI BENZ p. Other: ___
f. JAC k. OPEL

27
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
7. What model is it (would it be)?
______________

----------------------------------
8. Is your car new or second-hand?
a. New
b. Second-hand
9. When have you bought your car?
a. Before the pandemic (Earlier Mar-2020)
b. During the pandemic (Mar-2020 and later)

10. What was the payment method to buy a car?

a. Cash
b. Payment by installments
c. On credit
- - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - -
11. The main reason to use the car
a. Source of income/Business
b. Commute to work
c. Taking children to school
d. Shopping
e. Leisure activities

12. Please rate criteria you pay attention to while choosing the vehicle from 1 to 10,
where 1 - most important and 10 - least important
a. Additional f. Reliability/Quality
features/Conveniences g. Safety
b. Capacity/Number of seats h. Styling/Color
c. Fuel Economy i. Technical equipment
d. Manufacturer company j. Further market
e. Price demand/Reselling option

13. What criteria, if any, that is not mentioned above also crucial while choosing a car?
___________

Additional questions arising from specific answers of the respondent:

1. Have you bought a car initially planned?

a. Yes
b. No
2. Has the absence of a particular vehicle model affected your final choice?
a. Yes
b. No
3. Which second-tier bank services did you use to make a payment?
a. Alfa-Bank j. Other: ____
b. Bank CenterCredir
c. Bank RBK
d. Bank VTB
e. Eurasian Bank
f. Halyk Bank
g. Jusan Bank
h. Kaspi Bank
i. Sberbank

28
Why Kazakhstani consumers tend to buy particular brand and based on which insights?

4. For how long did you apply for an instalment plan/loan?

a. up to 1 year
b. from 1 to 3 years
c. more than 3 years

29
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
Appendix 2 – Questionnaire results

1. Indicate your gender

Gender No. of responses %
Male 92 52.87%
Female 82 47.13%
Total 174 100.00%

2. Indicate your age

Age No. of responses %
0-24 50 28.74%
25-34 66 37.93%
35-44 40 22.99%
45+ 18 10.34%
Total 174 100.00%
3. Indicate your city (region)
City/Region No. of responses %
Almaty 116 66.67%
East Kazakhstan 2 1.15%
West Kazakhstan 15 8.62%
Nur-Sultan 21 12.07%
North Kazakhstan 5 2.87%
Shymkent 7 4.02%
South Kazakhstan 8 4.60%
Total 174 100.00%
4. Indicate your monthly income
Monthly income level No. of responses %
0 – 199 000 KZT 51 29.31%
1 000 000 KZT + 17 9.77%
200 000 – 299 000 KZT 42 24.14%
300 000 – 499 000 KZT 39 22.41%
500 000 – 999 000 KZT 25 14.37%
Total 174 100.00%
5. Do you drive a car regularly?
No. of responses %
Yes 93 53.45%
No 81 46.55%
Total 174 100.00%
6. Do you own the car you drive?
No. of responses %
Yes 79 84.95%
No 14 15.05%
Total 93 100.00%

7. Who owns the car you drive?

No. of responses %
Employer; entity 3 21.43%
Family member; relatives 11 78.57%
Car sharing services 0 0.00%
Total 14 100.00%

30
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
8. Do you plan to buy a car?
No. of responses %
Yes 65 68.42%
No 30 31.58%
Total 95 100.00%

9. When do you plan to buy a car?

No. of responses %
next year and beyond 49 75.38%
within a year 11 16.92%
within following 6 months 5 7.69%
Total 65 100.00%
10. What brand is (would be) your car?
No. of responses %
TOYOTA 43 29.25%
HYUNDAI 27 18.37%
LEXUS 15 10.20%
KIA 12 8.16%
VOLKSWAGEN 9 6.12%
AUDI 6 4.08%
MERCEDEZ-BENZ 6 4.08%
BMW 4 2.72%
MITSUBISHI 3 2.04%
Range Rover 3 2.04%
SUBARU 3 2.04%
CHEVROLET 2 1.36%
NISSAN 2 1.36%
SKODA 2 1.36%
FORD 2 1.36%
LADA 2 1.36%
MAZDA 1 0.68%
PEGEOT 1 0.68%
Porsche 1 0.68%
RENAULT 1 0.68%
SUZUKI 1 0.68%
Tesla 1 0.68%
Total 147 100.00%

11. The main reason to use the car

No. of responses %
Commute to work 89 60.54%
Leisure activities 32 21.77%
Source of income; business 10 6.80%
Taking children to school 15 10.20%
Shopping 1 0.68%
Total 147 100.00%

12. Please rate criteria you pay attention to while choosing the vehicle from 1 to 10, where 1
- most important and 10 - least important. The value for the criteria cannot be repeated.

31
 Why Kazakhstani consumers tend to buy particular brand and based on which insights?
1 2 3 4 5 6 7 8 9 10
Safety 46 9 14 7 4 5 3 15 5 39 46
Reliability; quality 44 13 13 5 2 1 4 14 11 40 44
Price 40 13 13 6 8 9 5 13 8 32 40
Fuel economy 35 16 15 9 14 6 9 13 7 23 35
Further market demand; reselling option 33 20 12 4 13 10 9 10 10 26 33
Manufacturer company 30 12 21 14 3 5 10 11 11 30 30
Capacity; number of seats 28 18 13 11 18 11 7 15 11 15 28
Technical equipment 26 18 19 8 10 7 12 17 6 24 26
Additional features; conveniences 26 16 18 8 13 10 12 14 5 25 26
Styling; color 17 17 21 9 19 13 6 14 9 22 22

13. What criteria, if any, that is not mentioned above also crucial while choosing a car?
• fuel type, transmission
• reasonable prices
• Spare parts are a lot cheap
• Winter tires
• Interior
• clearance
• Comfort
• Body
• Moers
• Place of assembly
• Availability in the salon
• tax
• Taxes, gasoline
• Not emergency
• Exchange of old cars for new
• Trunk volume
• Inspection with a thickness gauge
• Practicality
• Cross-country ability, for outings and driving on a dirt road
• Customs clearance
• Sanitation or hygiene of a car
• Estimated delivery time
14. Is your car new or second-hand?
No. of responses %
Second-hand 57 72.15%
New 22 27.85%
Total 79 100.00%

15. What was the payment method to buy a car?

No. of responses %
On credit 19 24.05%
Cash 50 63.29%
Payment by installments 10 12.66%
Total 79 100.00%

32
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
16. Which second-tier bank services did you use to make a payment?
No. of responses %
Sberbank 9 32.14%
Halyk Bank 6 21.43%
Kaspi Bank 6 21.43%
Eurasian Bank 2 7.14%
Bank CenterCredir 2 7.14%
Forte bank 1 3.57%
Alfa-Bank 1 3.57%
ATF Bank 1 3.57%
Total 28 100%

17. For how long did you apply for an instalment plan/loan?
No. of responses %
up to 6 months included 1 3.45%
from 6 months to 1 year 5 17.24%
from 1 to 3 years 9 31.03%
more than 3 years 14 48.28%
Total 29 29

18. When have you bought your car?

No. of responses %
during the pandemic 33 41.77%
before the pandemic 46 58.23%
Total 79 100.00%

19. Have you bought a car initially planned?

No. of responses %
Yes 18 54.55%
No 15 45.45%
Total 33 100.00%

20. Has the absence of a particular vehicle model affected your final choice?
No. of responses %
Yes 8 53.33%
No 7 46.67%
Total 15 100.00%

33
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
Appendix 3 – Preliminary interview questions

1. Please describe your customer profile and separately characterize the loyal customer
a. Gender
b. Average age
c. Income range
d. Lifestyle
e. Etc.
2. The most demanded vehicle model and why?
3. How the demand changed during the last 5 years?
4. Pandemic effect in detail
a. Main challenges
b. Has the customer changed and how?
c. Data on lost sales

Appendix 4 – Interview transcripts

Interviewee: ZHIGER AZBERGENOV, "Allur "Group of Companies" Official Representative

1. Please tell us in detail how the pandemic affected you, the closure of state borders, the
closure of dealerships for quarantine.
I’m lying if I say that the pandemic did not affect the work of the group in any way -
although according to KPI we are going to overfulfill at the end of the year. We, like all large
enterprises, in the first months were engaged in in-depth analysis of the situation. As a result, it
was decided to send office employees to a remote form, but not to stop production. At the same
time, the group introduced the most stringent measures to protect the health of the entire team - a
daily comprehensive check, mask regime, only later voluntary vaccination, etc. Soon the situation
leveled off
Restrictions on state borders also made adjustments. Fortunately, we had stocks for the
first, most difficult period for machine sets, so that the workshops did not remain without work.
The dealer network was transferred to the online form. We were able to promptly introduce
this innovation with the support of the Ministry of Digital Development, Innovation and Aerospace
Industry of the Republic of Kazakhstan, our partner, the Eurasian Bank. After a while, we returned
to the previous mode, but online purchases, according to our observations, still remain relevant
to this day.
2. Can you claim that you have recovered from the announced pandemic and returned to
the previous production and sales volumes?
Despite the global downturn in world markets, sales of new cars in Kazakhstan for the
period from January to October 2021, according to the Association of the Kazakhstan Auto

34
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
Business (AKAB), amounted to 96,836 units, which is 31.9% higher than the figures for the same
period last year. Of these, our brands are growing. So, for example, Chevrolet cars - 24 950 units.
(+ 340.3% growth), Kia - 7 854 units (+ 55.2% growth), JAC - 2 190 units. (+ 43.4% growth),
etc. The SaryarkaAvtoProm manufacturing plant is going to fulfill the plan of 60 thousand
vehicles. So, in general, we can note the stability in the development of our group, even during a
pandemic. The same dynamics was observed in the first year of the appearance of the coronavirus
in the country.
3. Tell us about your consumer's behavior in chronological order - Jan-20, Mar-20, May-
20, Aug-20, Oct-20
From January to March, there were no significant changes in the behavior of our client.
At the end of March, and moreover, we launched a new Chevrolet line for Kazakhstan, which
contributed to an increase in both production volumes and saturation of the country's market. May
has become a turning point, in a sense, a period. We paid a lot of attention to the online sales
platform. Let's say we got used to innovations together with the client. In August, a request was
received from the Ministry of Health of Kazakhstan and concerned business participants - it was
necessary to prepare ambulances for medical workers as soon as possible. Then, by order of
Kaspi.kz and Samruk-Kazyna, Chevrolet DAMAS were prepared, and for the Ministry of Health -
JAC Sunray and medical complexes based on Yutong. A total of about 1000 units of transport in
a very short time - but we managed it. It could not be otherwise, because everywhere there was a
shortage of ambulances and tools to prevent the development of COVID-19.
4. Has the picture of a passenger car buyer changed (standard of living, wealth, age)?
Definitely yes. Many of Kazakhstanis, due to the lack of the opportunity to travel, up to the
closure of leisure places, managed to keep their savings and use them to purchase a car for
themselves and their families. The more respectful attitude of persons of venerable age during the
quarantine, to some extent, rejuvenated our client. Now we mainly work with a younger audience.

Interviewee: RATBEK BAYENOV, Kazakhstani blogger, car lover

1. How do you think COVID-19 has impacted the auto industry as a whole?
We all know that car manufacturers assemble car details from different countries. And
because of the covid, there were big problems with logistics. For example, they took chipsets in
China, a box somewhere, and then they collected everything in one place. In a word, because of
the covid, due to restrictions, if you look at the statistics, then the number of cars produced in 2020
and 2021, then you will see that only very few cars were produced, and became the shortage of
cars in the world.
2. What changes did the Kazakhstani car market face during the pandemic?

35
Why Kazakhstani consumers tend to buy particular brand and based on which insights?
In order for car dealers to somehow survive, they had to put additional accessories on the
cost of the car. For example, if a Hyundai accent car from the salon costs 8 million, then the salons
additionally put a video recorder, a film for glass and other trifles, and sell for 8,500,000 in order
to somehow make money.
3. In your opinion, has the demand of the passenger car buyer changed? What is the key
aspect of buying a car now?
I can say from my own experience that there are practically no cars in car centers now. I
can suppose that demand has changed. Now people buy cars from the second market because it's
cheaper. Now the main aspect of buying a car is the price.
4. Do you think now people buy more cars from the showroom? Or used? Or Trade-in?
As I said earlier, there is now a great demand for the secondary market. Since the cars that
remained in the auto centers are very expensive, and now the secondary market is developing very
rapidly. And Trade in too. But I do not want to say that there is no demand for new cars from the
centers, of course, there is, but the cars themselves are simply not available.
5. Do you observe a change in demand due to the lack of a car in the showroom? What is
the demand changing, in favor of a used car or another brand?
There are no cars in the center because there are no chipsets, and without this computer,
the car will not go. Now many people buy cars from the secondary market, because in Kazakhstan
we have a very expensive recycling fee (waste collection), in the whole world there is no such
waste collection as we do. For example, waste collection for cars that have 2 liters of volume,
waste collection will cost 1000,000, and if the volume is 2.5, then waste collection will cost
1,500,000. And if more than 3 liters, then 3,500,000 will cost. This is why we have very expensive
new cars.
6. Can you please tell us your guesses and assumptions about the future of the car market
in Kazakhstan?
For example, if you take a Toyota Corolla, in 2015 this car could be bought for 3,900,000
tenges. Now, this same car can be sold for 8,000,000 million. Do you understand the difference?
I cannot say for sure my guesses, because I myself am not sure, but I will say one thing that prices
will rise. And I heard that the government canceled the Preferential program, so the demand for
cars assembled in Kazakhstan has decreased.
7. What do you think is the most popular / topical car brand in Kazakhstan now? (If you
want you can make the top-3. And it would be great if you could explain why exactly they are)
From the new cars that were actively sold in 2020-2021, this is the Chevrolet. But
this is because of the preferential program because they are collecting in Kazakhstan and it was

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Why Kazakhstani consumers tend to buy particular brand and based on which insights?
profitable to buy this car because it was like 7-8% of the annual rate. So, in terms of popularity in
the first place is the Chevrolet. In second place in Hyundai sales. And the third is Toyota.

Interviewee: DAMIR ISMMAILOV, Head of Digital Marketing at Mycar.kz

1. How do you think COVID-19 has impacted the auto industry in Kazakhstan?
The shortage of new cars, as well as throughout the world, has affected the cost of used
ones. People wait for an order for several months. Available premium brands and new Chinese
models.
Auto demand has been on the rise since the release of quarantine in 2021. Children were
returned to schools, workers to offices, the market for food delivery and taxis is growing - people
need a car for freedom of movement, since city transport is not doing its job.
2. Do you think now people buy more cars from the showroom? Or used? Or Trade-in?
I have no opportunity to provide these data in numbers. There is nothing to buy from the
salon, people buy from each other, in the centers of used cars. Trade-in teaches the replacement
of an old car with a new one, since there are no second ones, which means that the exchange
program does not work either.
The demand for used cars is so high that these cars are selling for more than they bought
2-3 years ago in dollar terms, despite the wear and tear during this time.
3. Can you please tell us your guesses and assumptions about the future of the car market
in Kazakhstan?
Wealthy people keep buying Lexus, BMW, Range Rover and Mercedes. Those who could
afford Korean cars before are likely to switch to the Chinese. Chevrolet will also boost sales,
especially Cobalt, still a favorite of taxi drivers. Perhaps some brands will leave, unable to
withstand the competition. In the summer-autumn of 2022, it will already be better with a new car,
there will be more imports and domestic production in Kazakhstan, as they will establish the
production of microchips.
Chinese brands are starting to take over the markets. Jac, Chery (sales start on December
10, 2021). Haval has sold 1000 cars this year and the dynamics will continue to grow. Jac 2500
cars - their new record.
4. Top three auto brands in Kazakhstan, in your opinion?
Chevrolet, Hyundai, Toyota.

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