A report published by Alpen Capital, a research centre, revealed valuable information about the automobile market in GCC. The report stated that the number of passenger cars in use in the GCC is expected to grow at 5% every year to reach 13.2 million in 2020, up from 10.3 million in 2015.
The report mentioned that new car sales are projected at 1.4 million cars in 2020, compared to 1.2 million cars in 2015. Although sales for new cars have decreased in 2016, the experts who prepared the report are optimistic and forecasted a stable 2017 and a growth in 2018.
The decline in car sales in 2016 was due to economy recession in the GCC. The main reason behind economy recession is the drop in oil prices and the war in Yemen. The recession has made the year 2016 very difficult for car dealers in this region as consumers tighten discretionary spending and delay buying new cars.
And despite the expected growth which was mentioned in the report, the growth is much less than the growth registered between 2010 and 2015.
The Used Car Market
The used car market in the GCC region is considered very active, simply because consumers tend to change their passenger cars every couple of years and sometimes after few months. And about the biggest challenge for the used car market in the GCC, the report said that the biggest challenge is public transportation.
All households with small income will not need to have a car once the public transportation projects are complete. for example, Qatar Metro is expected to carry over 4 million passengers every year. Another challenge is the recent entry of taxi-hailing service providers in the region which could slow vehicle sales as they expand across key cities in the Gulf such as Careem and Uber.
Most Popular Cars in GCC
Japanese car brands remain the most popular in the GCC for used and new cars. And the the high-end market continues to be dominated by European makes, Chinese brands are fast closing the gap with low pricing and less maintenance cost, said Alpen.
The Car Market in Qatar
During 2010-2015, Qatar recorded the fastest increase in new vehicle sales in the GCC. New car sales in Qatar are projected at nearly 76,000 units in 2020, indicating a CAGR of 1.8% from 2015.
This report contains amazing facts about the automobile industry in the GCC. You can download the full report from here.
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