Dubai: BMW’s Dubai and northern emirates dealership, AGMC, is entering a joint venture with the BMW Group’s financial services arm to offer financing options to prospective car buyers. The venture is expected to push the start button in the second quarter, according to a top AGMC official.
“The auto retail environment is so competitive that as a dealer we need to constantly tweak what is on offer for a premium car ownership experience,” said Othman Abdul Moneim, general manager at AGMC, which sold more than 4,000 new BMW Group models in 2013. “It meant that all possible angles have to be covered — the captive financing option we will launch is meant as much for retail buyers as corporate fleet owners. This will also help us tailor specific packages for vertical sectors such as the hospitality sector.”
The UAE’s premium vehicle category has had three successive years of unprecedented growth. This is even more the case with the super-luxury marques, for which the UAE ranks among the Top 5 markets worldwide from a unit sales perspective. Going by volumes in the first two months of this year, another record run beckons.
For the BMW Group, this is their first exposure to the financing side of things at its Middle East network. Automotive majors and dealerships doubling up as financing partners is still an untested area in the UAE and elsewhere in the Gulf. But financing has been a lucrative line for the global giants especially in their US and European operations.
Porsche recently extended its financial services arm to the UAE and has struck an alliance with Emirates NBD. Among local dealerships, Al Futtaim Motors operates a hugely successful financing operation.
On the parameters that the proposed venture will take on, Abdul Moneim said: “The UAE Central Bank has clearly mandated an 80:20 split, with 20 per cent being the required down payment. That will be our norm as well, but that still leaves a lot of room in how, for instance, packages can be put together for fleet buyers.”
Apart from BMW, the options will also extend to the Mini stable. AGMC also represents Rolls-Royce in Dubai and northern emirates, but it is highly unlikely that a typical Rolls buyer would need to go over financing options. Apart from new cars, AGMC’s BMW pre-owned car programme is building up nicely, this is area which the financing venture can work on.
“For 2014, our corporate campaign has been built on four pillars — there’s mobility (the financing venture is part of that), and enhanced customer convenience features such as airport pick-up and further refinement on servicing deals,” Abdul Moneim said. “There’s also customer care [24-hour call centre and concierge services, and on-road safety focus through an on-board SOS button, etc].
“Each year we are getting new first-time buyers to the BMW Group offerings — our goal is to make them commit to these brands for life.”
