Dubai: There is nothing like having a four-wheel drive in the portfolio to gain traction on GCC roads. Jeff Mannering, regional managing director at Audi, can provide any confirmation that's needed.
"The launch of the first-generation Q7 in 2005 gave Audi a huge boost in terms of visibility and sales as the region's affinity to SUVs is higher than almost anywhere else in the world," Mannering said. "The success story continued with the introduction of our Q5 in 2009."
Indeed, the Q7 followed in quick succession by the Q5 gave Audi the volume gains that were never there when it only had the saloon range to back up sales. Last year, the two SUV models contributed a hefty 35 per cent of unit sales in the region, while the Q7 itself was the carmaker's best-selling model with 1,588 units. A repeat — or even a better — performance is not being ruled out this year.
"Overall, the goal is to achieve double-digit growth again in 2012 and potentially another record year," said Mannering.
There are other automotive marques that could tell similar stories of SUV-induced dream runs. Think Volkswagen and the Touareg. Think Infiniti and the EX and the FX, and carmakers will not be alone in making the connection between having an SUV model that appeals to one of the most discerning set of car buyers in the world.
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And as carmakers would have you know, SUV sales also provide that sharp performance edge to the bottom-line. In a market such as the GCC, it also provides them and their dealerships a committed SUV buyer for life. At three of the leading dealerships in the UAE, more than 90 per cent of SUV buyers migrated to an upgraded model or a newer higher priced variant during trade-ins.
Another role that SUVs have taken on is being the safety valve when market conditions are just not that conducive for auto sales. Such was the case in the UAE during 2009 and the better part of 2010, when the downturn spawned the worst crisis in the country's automotive space.
"While our sedan sales took a 40 to 50 per cent hit during 2009, we managed to inch our way through the crisis only through the demand generated by the SUV range, which were only down by 5-10 per cent," said a senior manager with a local dealership.
"There's another aspect to it — the cost of selling a SUV is historically lower compared with sedan for a dealership. You don't need to drop sticker prices by that much, spend more on promotions and customer incentives."
And when the recovery comes calling, SUVs can take the lead just as easily. Felix Welch, director of sales and marketing at Arabian Automobiles Co., goes over recent history when he says: "Our SUV sales in Dubai and the northern emirates hit a peak in 2008 in line with the overall market volume which reached a record high that year too.
"The market bottomed out in 2009, but since then our SUV sales have grown steadily by around 4 per cent per year, and in 2012 we expect a further 2 per cent growth in SUV sales."
These days, most SUV portfolios include a variant that gets many customers on board — the crossovers. "Manufacturers have responded to customer tastes and extended the traditional SUV segment into crossovers which adopt more passenger car-like characteristics and architectures," said Welch.
"Certainly both Nissan and the Infiniti have fully embraced both the SUV and crossover segments."
For a dealership like Arabian Automobiles, which oversees a line-up of 11 SUVs and crossovers between Nissan and Infiniti, that translates into quite a lot of models moving out of the showrooms into the customers' garages. Last year, these units made up 25 per cent of the company overall volumes.
Of all SUV sales, Welch says, "Crossover sales contributed 21 per cent — so they are very significant. However the crossover segment of the market is now highly competitive with many new product entries and lots of customer choice."
Not that any prospective buyer would mind in the least. Taking that sentiment forward, it would only add more four-wheel drives on the UAE and Gulf roads.
The SUV rules!
