UAE News – October 2021
“Shifting preference of consumers from availing public transportation to private vehicles fueled by the impact of COVID-19 has driven the growth of Used Car Market in UAE.”
Increased Awareness on Health and Hygiene: With the advent of COVID-19, consumers were witnessed to be more concerned on maintaining personal health and hygiene. Therefore they are preferring the option of private transportation rather than availing public transport system. The change in consumer’s behavior and preference is expected to act as an opportunity for the used car market in UAE. Due to weaker economic sentiment and financial constraint followed by the aftermath of COVID-19, consumers are not willing to spend a huge amount in buying new cars rather they are preferring to buy affordable used cars which helps them in maintaining their health by spending less. Therefore the future prospect of the industry looks strong wherein used cars players in the market could utilize this opportunity to integrate the market.
Technological Impact and Omni Channel Strategy: Technology has deeply impacted the used car market as it has altered the buying behavior of the customers. Most of the customer journey today begins with online search; hence it gives the retailers to mark their presence at the start of the customer journey. Currently many companies are using Omni channel strategy to reach out to the customer. The players in the market have realized the importance of a multichannel approach to sales wherein they provide seamless customer experience combining the use of digital as well physical platforms such as communication through mobile and laptop devices or brick and mortar space therefore formulating Omni channel strategies to reach out to customers. This type of channel is useful as the digital presence is an important parameter to improve the customer penetration while the physical presence helps in building of trust of the customers. The need of such Omni channel strategy would help the players in increasing their visibility in coming years as more and more customers adapt to the digital medium of buying and selling followed by the aftermath of COVID-19. The advent of digital technology has given varied domains to the customers which they can explore to find the most suitable way to buy a car. In general, the customer uses both the digital and the physical channel simultaneously in order to find the best product according to their needs.
Large Number of Expatriate Population: As of July 2021 it is estimated that expat population in UAE constitutes 88.6% of the overall population. Mostly expats in UAE are living for a specific duration of time till their employment contract expires. Due to this nature, these expats prefer buying a pre-owned vehicles rather than spending huge sum of money in buying a brand new car which has resulted in increased demand of used cars over the years. Affordability plays a deterministic role in choosing a used car over a new car. In coming years, the expat population in UAE is estimated to constitute 90% of the overall population which will keep the demand prospect of used cars at an all-time high.
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Value Added Services: Used car market players in UAE, in an effort to differentiate its offerings are providing a number of value-added services along with the used cars which serve as one of the major competition parameter in UAE. These value-added services include warranty, financing options, accessories and others. Many dealerships have tie ups with loan providing financing companies. These value-added services have a placebo effect on the assuring quality of the car in the mind of customers. Thus, help in creating a positive brand perception in front of the customers. These value-added services also prompt the customers to pay a marginally more while buying through a dealership. This trend will help in consolidating the market share of players selling via B2B/B2C channel in the market as players selling via C2C sales channel does not offer a wide range of necessary value-added services such as transfer of ownership, tax registration and payment, quality check and assurance and others. Thus, in the future value added service offerings would play a pivotal role in developing the demand ecosystem of used car market.
Expo 2020: In recent years, UAE has been initializing the process of shifting away from oil dependence and enhancing its economic capability to develop others sectors, such as tourism, IT, pharmaceuticals, automotive, real estate etc. Therefore Expo 2020 is seen as a platform which will contribute to major investment opportunities in diversified sector of UAE especially Dubai. Automotive sectors in UAE is a growing industry wherein most of the cars are imported from Japan, Germany, America, and South Korea among others. Therefore, expo 2020 will act as a platform to develop and attract investment in the automotive sectors coupled with efficient technological solution, which will change the ecosystem of the industry. With the structural change in automotive sector, there is a greater possibility to enhance the capability of used car market in Dubai wherein players in coming years would look forward to adapt to effective digital solutions to attract consumers and participate in growing the used car market in UAE.
The report titled “UAE Used Car and Auto Classified Market Outlook to 2025” by Ken Research suggested that the used car market in UAE is expected to grow further in the near future, with the increased awareness on health and hygiene followed by the onset of COVID-19, thus showcasing a change in consumer preference from availing public transport to private transportation medium. Large number of expatriate population along with export prospects of used car in UAE will be major growth drivers for the market in coming years. The market is expected to register a positive CAGR of 16.6% in terms of revenue during the forecast period of CY’20-CY’25.
Key Segments Covered in UAE Used Car Market
- Used and New Cars Re-Export by Country
- UAE Free Zone
- Saudi Arabia
- Iraq
- China
- Oman
- Used and New Cars Export by Country
- UAE Free Zone
- Mali
- Sudan
- Somalia
- Congo
- By Type of Car
- SUV/Crossover
- Sedan
- Coupe
- Hatchback
- Pickup Truck
- Sports Car
- Convertible
- Other (Utility Truck, Van, Wagon etc.)
- By Type of Manufacturer on the basis of Region
- Japanese
- German
- American
- Korean
- British
- By Region
- Dubai
- Sharjah
- Abu Dhabi
- Umm Al Quwain
- Ras Al Khaimah
- Fujairah
- Ajman
- By Sales Channel
- Online Marketplace Players including Classified Channel
- B2B/B2C Dealers
- C2C – (Word of Mouth)
Key Target Audience
- Used Car Dealerships
- Classified Used Car Retailing Websites
- Online Marketplace Websites dealing in Used Car
- Auction Players
- Used Car Financing Companies
- Government Bodies
- Investors and Venture Capital Firms
- Used Car Associations
- Used Car Buyers
- Used Car Sellers
Time Period Captured in the Report:
- Historical Period: 2015-2020
- Forecast Period: 2020-2025
Used Car Companies in UAE:
- Dealerships
- Al-Naboodah Automobiles
- Arabian Automobiles
- Al-Tayer Motors LLC
- Al-Ghandi Auto Group
- Online Marketplace Players
- Al-Futtaim Automall
- Gargash Motors and General Trading LLC
- Alba Trading FZC
- Cars24
- The Elite Cars
- Swaidan Motors
- Galdari Pre Owned
- Autotrust
- SellAnyCar
- Car Switch
- Classified Companies
- Dubizzle
- Yalla Motor
- Dubicars
- Carmudi
Key Topics Covered in the Report
- Value Chain Analysis of UAE Used Car Market
- UAE Used Car Market Ecosystem
- Customer Profile of UAE Used Car Market
- UAE Used Car Market Size, 2015-2020
- UAE Used Car Market Overview
- UAE Used Car Market Size by Transaction Value and by Sales Volume, 2015-2020
- UAE Used and New Cars Re-Export by Value and by Country, 2015-2020
- UAE Used and New Cars Export by Value and by Country, 2015-2020
- UAE Used Car Market Segmentation, 2020 (by type, manufacturer, sales channel, region age)
- Competitive Landscape of UAE Used Car Market, 2020
- Parameters of Competition of UAE Used Car Market
- Market Share of UAE Used Car Market Players – (Dealership Network, Online Marketplace Players and Classified Companies)
- Company Profiles of Arabian Automobiles, Al-Naboodah, Al-Tayer Group, Dubizzle, Yalla Motor, DubiCars, Carmudi, Al-Futtaim Automall, Elite Cars, SellAnyCar, and Car Switch
- Trends and Developments in UAE Used Car Market
- Growth Drivers of UAE Used Car Market
- Challenges and Restraints in UAE Used Car Market
- SWOT Analysis of UAE Used of Market
- Porter 5 Forces Analysis of UAE Used Car Market
- Government Regulations in UAE Used Car Market
- Recent Developments in UAE Used Car Market
- Channels Used for Selling Pre-Owned Cars in UAE – (Dealerships, Classifieds and Online Marketplace)
- Impact of COVID-19 on UAE Used Car Market
- UAE Used Car Market Future Outlook and Projections, 2020-2025E
- Analyst Recommendations
- Macro-Economic Factors Affecting Used Car Market in UAE
- Directory of Automotive Dealers in Luxury Segment in UAE
Related Reports
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