Business | Shipping
Public rail transport system unlikely to derail luxury car sales
Dubai's planned public rail transport system is unlikely to derail sales of luxury cars, according to a Mercedes Benz dealer.
- By Shakir Husain, Staff Reporter
- Published: 00:00 February 27, 2006
Dubai: Dubai's planned public rail transport system is unlikely to derail sales of luxury cars, according to a Mercedes Benz dealer.
Development of efficient public transport services may slow down sales in the prestige car segment, but its effect would not be significant, said Malcolm Cooper, group business manager for Gargash Enterprises.
"It is not going to affect us in a way that starts affecting our growth. If there is a new system of public transport or railway lines, it will free up the road system. This may give people more confidence in purchasing a vehicle," he said.
"These projects are never there to harm service industries like the motor trade. The municipality is already thinking ahead with all these projects," Cooper told Gulf News.
He said luxury car sales in Dubai were driven by easy availability of finance and the city's rapid growth, the factors that might continue to support the automobile business in the long term.
Gargash has seen huge growth in financing provided by banks to its buyers. Its total finance volume increased from Dh291 million in 2004 to Dh470 million in 2005.
With loans amounting to Dh195 million in 2005, HSBC topped the list of banks financing Gargash's buyers. With Dh87 million, Emirates Bank was the second biggest finance provider to Gargash customers in 2005.
Last year, Gargash sold 4,056 vehicles, up from 3,300 in 2004.
Cooper said an increasing number of customers were opting for the Islamic way of financing. Banks operating under Islamic rules lend money without interest but levy service charges to cover their expenses and profit.
Gargash has set up a special unit for female customers looking for Islamic financing. Buying for cash has seen a decline in the last two years because of the booming property market and investment options available in the UAE stock markets, Cooper said.
Luxury car sales in Dubai are driven by easy availability of finance and the city's rapid growth, the factors that might continue to support the automobile business in the long term, says Malcolm Cooper.
Share this article
Popular in Business
-
Property
Burj Khalifa effect
Proximity to the world's tallest tower proves advantageous for hotels
Business Editor's choice
-
India's big gamble on growth
Second wave of reforms needed to ensure the success of a strategy
-
World sugar supply takes a beating
Harvests miss target in several producing countries due to lingering frought
-
Cloud culture is way forward
In terms of collective IQ, Google is the smartest company in cyberspace
