Automobile sales are up 64 percent to a record $33.8 billion, spurred by $27 billion in sales of foreign car models. GM/Chevrolet and Hyundai are market leaders, pushing ex-leaders Ford to 3rd and Toyota to 4th place.

Russia's rise is also fueled by a decrease further west. Renault CEO Carlos Ghosn had predicted in January that Russia would pass Germany within two years, while Ford's European chief, John Fleming, had said in June that it might do so in 2009.

"Huge public demand for new cars will continue the upward trend for years to come as more middle-class families benefit from the booming economy," said Marina Irkly, an automotive analyst with Veles Capital Investment. "Russia's growing economy is also expected to fuel a high replacement rate for old cars in the next two or three years."

Russian auto sales are likely to reach 3.8 million this year if the present level of growth is sustained, PwC said. German deliveries may total 3.2 million, according to estimates from the country's VDA trade association published July 2.

"Russia may become Europe's biggest market in 2008 after surpassing Germany in the six months," PwC partner Stanley Root said in the report, citing VDA figures showing sales in Europe's biggest economy rose 4 percent to 1.63 million in the half.

Russian car imports jumped 54 percent to 785,000 in the period, almost half of total sales, and purchases of locally made foreign cars rose 41 percent to 290,000. Chevrolet was most popular, with sales reaching 103,735.

Nine of the top 10 overseas carmakers in Russia are U.S. or Asian, the report said. Meanwhile, Chinese automakers in Russia are experiencing cooling demand, due to halt of production at the Chery plant in Avtotor, the report said.

Russia will account for 20 percent of global growth in car sales through 2015.

What this means to you: Things are definitely looking up for the Russian economy. — Taj Adelaja, Correspondent

via edmunds