In January, a large Russian betting company announced a lottery to award special prizes for its clients: Rolls-Royce Cullinan.
Following Moscow’s full-scale invasion of Ukraine in 2022, the US, the European Union, the UK and many other countries have banned Russian exports to Russia, which exceeds approximately $50,000, the starting price of Cullinan, which can win nearly $1 million in Russia.
At the same time, major foreign automakers, including those that manufacture luxury models, have closed their Russian factories and offices.
The banned $50,000 price tag is intentional and is intentionally targeted at high net worth individuals who are likely to have ties to the Russian state.
Meanwhile, the general departure of carmakers from the Russian auto market has helped to completely change their makeup.
The Chinese brands currently on the market have around 70% of all new cars on the streets.
But for that reason, expensive Western luxury cars still have easy access to the super rich people of Russia.
Russian customs data shows that when the western ban came into effect during March 2022, around 1,300 vehicles worth more than $100,000 were brought to Russia.
Who is importing it?
RFE/RL’s Russian Language Research Force, Systemema, tracked the supply chain and found several companies importing vehicles through jurisdictions like South Korea.
Systemema’s findings suggest that having connections with military and security services, like other parts of President Vladimir Putin’s Russian president’s economy, does not do any harm when it comes to entering the approved luxury automobile business.
Avoid sanctions
In a direct response to sanctions imposed on the Russian economy, Putin signed a law that legalizes parallel imports in June – importing goods without right-handed permission.
The law allowed new import channels for many types of items, including high-end vehicles such as Bentleys and Maseratis.
It was not legal to trade approved goods outside of Russia.
In 2024 alone, three German individuals were sentenced to prison conditions of four to six years, as they exported hundreds of luxury cars to Russia.
Last month, two Belarusians and two Lithuanians were detained on suspicion of similar activities.
However, in the Russian automobile business, signals were given.
In total, Systemema has identified 179 Russian importers and 220 exporters from 26 countries that participated in the scheme to import prohibited vehicles between March 2022 and October 2024.
Most of the Russian companies identified as importing a large number of luxury cars are already involved in the automotive business, selling licensed cars along with Chinese brands conquering in new markets.
But one wasn’t. The St. Petersburg-based vague company specializing in fiber components has been found to have imported the most luxurious vehicles of all.
Registered in the undescribed business centre, Garant LLC had modest revenues before 2022, with the highest pre-war figure of 250 million rubles in 2020 (approximately $3.3 million at the time).
Today’s website continues to promote its position as a provider of “electronic devices and components.”
Until the Parallel Import Act came into effect, Galant, whose name was translated as “guarantor” from Russian, spent only $880,000 a year on imports.
Garant’s Sole Supplier is run by Product Factory Limited in Hong Kong by Chinese national and Shanghai resident Miao Dong.
Jiating was registered in 2013, and its website boasts that the company has been a “primary distributor” of “hard-to-find products” for the past 15 years.
However, between 2018 and 2021, Jiating’s exports to Russia reached less than $1 million a year, and was an overwhelming component of the fiber network.
In early 2022, Gating seamlessly switched to export luxury cars from its top clients, sending 305 cars worth $31.2 million in total, with 139 vehicles exceeding $100,000 each.
Russia’s security types and automotive business
The founder and director of Garant, which officially employs only nine people, is Maria Kalenova.
At least on paper, Karenova is also the wife of the former military, as well as Russia’s leading luxury car importer.
Her ex-husband, Alexander Stebakov, was one of three cadets at the Institute of Military Culture (VIFK) who beat 17 years old on the streets of St. Petersburg in 2003.
All three were taken into custody in the case, which appears to have not harmed their career prospects.
Vladimir Niyazov, one of the trio, is currently the chief inspector of the Ministry of Physical Training and Sports in the Russian Army.
Another Sergei Rashnikov joined the Federal Protection Services (known in Russian for the initials of FSO and translated as a federal government service), an organisation that inherited the duties of the Soviet top officials and military and security agencies responsible for the security of important national assets.
At the 2017 St. Petersburg International Forum of Culture, Luchnikov was one of the security guards accused of protecting President Vladimir Putin.
Lushnikov’s employment in FSO can be related to Carrenova’s entrepreneurial activities, as long as the body has an informal reputation for providing different types of protection – to favorable businesses including those involved in import and export.
While Karenova and Stebakov divorced in 2010, Rashnikov remained in Karenova’s circle of friends after remarriage.
A photo posted to Vkontakte shows her posing with Karenova during her 35th birthday party in December 2018.
However, according to financial data reviewed by Systemema, Garant is actually just an intermediary for Russia’s largest group of car dealers, Rolf and Major-Auto, and the final customer of all the cars the company imports from Hong Kong.
Founded in 1991 by Russian businessman Sergei Petrov, Rolf played an important role in forming the post-communist Russian automotive market.
However, in 2023, Petrov’s business was seized by the Russian state, and Umar Kremlev, a businessman who has led the International Boxing Association since 2020, was later revealed as Rolf’s new boss.
Independent Russian media usually describe Kremlev as a businessman with close ties to Russian security services and Russian sports.
A media survey released last year found that journalists from Russian outlet Preekt used GetContact (an application that utilizes crowdsourced telephone data) to find out how the phone numbers used by Kremlev were stored by other users.
The entries they found included “Umar FSO”, “FSO Umar”, and other variations that implied a direct link between Kremlev and FSO.
We weren’t there, we don’t know!
For major Western automakers, the losses in the Russian market after Moscow’s full-scale invasion of Ukraine were painful.
This was also true of the manufacturers of top-end vehicles, which Olihead elites in Moscow and St. Petersburg, were long-time customers.
However, many top car brands now argue that Russia may not exist from their perspective.
According to Russian customs data studied by Systemema, Mercedes-Benz cars were at the top of the list of luxury cars imported to Russia for more than two and a half years after sanctions ceased.
In response to Systemema’s question, Mercedes-Benz said the company is investigating the findings and will contact “related authorities” if it finds evidence of suspicious activity.
“In principle, we prohibit the sale of products to fraudulent intermediaries, even outside the territory of contract,” the spokesman said, adding that “subsequent resale… especially outside the network of certified dealers for second-hand cars, beyond the scope of influence.”
Jaguar Land Rover (JLR), Porsche, Audi, and BMW provided similar responses.
Hong Kong was a “transport hub” for Gallant’s licensed automobile imports, but several others have emerged since the Russian invasion.
The top of the list through October 2024 is South Korea, a major automobile manufacturer in itself, with its own sanctions banning the export of luxury cars to Russia.
Meanwhile, the boom in car imports from Kyrgyzstan from Europe and other Asian countries — a 10-fold increase compared to pre-war levels — has raised many brows.
The country’s pro-Russia government says it is doing everything it can to stop the flow of approved goods to Russia, which shares membership in the Eurasian Economic Union trade bloc.
However, another media survey released this month by Novaya Gazeta Europe focuses on how Kyrgyz President Sadyr Japarov’s orbital trajectory figures are involved in re-exporting luxury vehicles to Russia.
Speaking to Systemema, the UK lawyer Alexandre Prezanti said the “no Russia” clause, which imposes contractual obligations on importers in third countries to prevent re-exporting to Russia, is merely a recommendation for British cars and other goods.
Ilya Schmanoff, former director of Russia’s transparent international branch, told Systema that Brussels’ rules on the use of clauses are stronger and covered by the Council of Europe ruling.
But at this point, the stable trickle of expensive cars to Russia shows that the laws of supply and demand are in the driver’s seat.
Garant LLC, Rolf, Major-Auto, Jiating Product Factory Limited, Bentley, and Maria Kalenova did not answer any questions submitted by Systemema.
