Busy second-half for local automotive sector

Dubai: It seems as if not a week went by in the first half of the year without global automakers and their local dealerships having a launch. It was the done thing to do with the UAE’s automotive market in its best shape since the crash of 2009 and prospective car buyers thronging the showrooms.

For small cars to sports cars, from zany-shaped MPVs to full-throttle SUVs, they were there in their gleaming glory at showrooms and just waiting for their buyers to take possession of their keys. But if one gets the impression that all the new launches were front-ended into the first six months, think again. This week, Infiniti will roll out the JX to take up position in the fast-expanding niche for luxury crossovers. Volkswagen too had a launch, but of its best-selling sedan, Passat. The difference this time out is that the model is shipped out of VW’s US plant, which would give it a competitive pricing advantage compared to getting the same from Europe.

By mid-July the market will take time out to mark Ramadan, but come September, it will set the tone for a wave of new launches. The next-generation Range Rover will be formally unveiled that month and customer deliveries will roll off the showrooms by early 2013.

But if a Range Rover enthusiast wants to buy a new model right now, he should take a look at the Limited Edition LR4 Pursuit, which, according to the manufacturer, has been built exclusively for the region. Only 100 units of the model will be made.

Set to make their debut in the second-half will be Audi’s S family — the S6, S7 and S8. They come with a new 4.0-litre engine, which the manufacturer says provides for ample power and low fuel consumption “in keeping with the times.”

And there will be many more as automakers line up their 2013 model year launches of their generic brands. So, if demand keeps up with the first-half numbers, could 2012 turn out to be even better than 2008, when new vehicle sales in the UAE were estimated to have touched 325,000 units?

“My estimate would be that sales this year would be around 280,000-285,000 units, which is what it was in 2007 and that in my reckoning is a pretty good performance,” said Michel Ayat, CEO of Arabian Automobiles Co. “What the market did in 2008 was a one-off and I don’t think it will be good for the auto sector to have unrealistic expectations right now.

“Though it’s only been four years, it’s a completely different market to what it was in 2008 and the sector is still absorbing the impact of the 40 per cent drop in demand during 2009.

“Customer loyalty for a brand has faded and the biggest challenge facing dealerships is customer retention. It also means that gross industry margins are still lagging from the ill-effects of 2009.”

But it sure is a good time to go out and shop for new cars. The dollar’s strength vis-à-vis the euro and the yen will mean that models shipped out of Japan and the euro zone will have a better end-user price traction. “The dollar-dirham peg could be advantageous should competitors be procuring stocks in yen or the euro,” said Mark Kass, regional managing director at Al-Futtaim Honda.

Not that it will all be a European and Japanese show. The US majors are in line for a sizable share of the action. Liberty Automobiles, which represents Chevrolet and Cadillac, has drawn up a busy schedule of new launches.

This includes the recently introduced Malibu, Chevrolet’s offering in the critical mid-size sedan category. “The launch was very significant as the midsize segment is the second biggest in the UAE,” said Rajesh Krishnan, General Manager for Sales & Marketing, Liberty Automobiles. “The design takes cues from the iconic Camaro and the initial lot was fully sold.”

July will see the introduction of the New Colorado pick-up and followed by the Chevrolet Trailblazer and the Camaro ZL1 in October.

GM will also be upping the stakes in the premium category, with the introduction of Cadillac’s entry-level ATS model. This is scheduled for November.

“We believe the launch of these new products will surely boost the showroom traffic,” said Krishnan.

The auto majors and their dealerships have inked the launched dates. All that needs to be done are for buyers to synchronise their buys. If they do that, the second-half of 2012 promises to be just as frenetic for the auto sector. Happy driving!