It's the time for the next edition of the Dubai Motor Show - but there will be a change of scenery. Instead of the Dubai World Trade Centre, the action shifts to Dubai Harbour. And it will be a lifestyle-focussed event under the '#NoFilterDXB' branding. Image Credit: Gulf News Archive

Dubai: New car sales in the UAE are taking the fastest routes to make a comeback from the COVID-19 year - but there is still a problem.

While demand for new – and pre-owned – vehicles has been surging since September, dealerships are saying that they do not have enough stocks to keep up with the bookings. In some instances, especially on the luxury cars, buyers are paying an additional premium to make sure they get their model on time.

Demand is across the board and not limited to the popular auto brands. Each new anticipated launch brings out a rush of prospective buyers at the showrooms. Whether it’s a Dh50,000 model or a Dh400,000 and over bespoke one, the rush is on. It’s the same whether it’s a fuel-powered vehicle, a hybrid or an EV – there are ready buyers out there.

“Demand is growing - the only obstacle is to obtain enough stock to sell,” said K. Rajaram, CEO of Al Nabooda Automobiles, the local dealership for Porsche, Audi and Volkswagen.

Dubai Motor Show = #NoFilterDXB
Yes, The region's premier automotive industry event is morphing into a lifestyle focussed celebration of all that's happening in the world of wheels. The event, relocated to Dubai Harbour, opens later today and runs until November 27.
Stock - K. Rajaram of Al Nabooda Automobiles
According to K. Rajaram of Al Nabooda Automobiles, "I do not think maintaining (2022MY) prices would be a challenge due to the paucity of stock." Image Credit: Supplied

In comeback mode

Clearly, this is not a situation that dealerships were planning for. Last year, anyone in the business of selling cars were worried whether they were carrying a high inventory that would remain unsold because the pandemic was leaving a huge dent on demand. The question at the time was how long would it take for UAE car sales to recover.

They didn’t have to wait long. Auto industry sources say that some pickup in demand was seen during the Eid promotions, then dipped during summer, but by late August and early September, demand was back in full throttle. So much so, current buyer interest is running even ahead of pre-Covid times.

That’s what Karl Hamer, CEO of Adamas Consultants, believes is happening. “Demand this year has been exceptionally good - but the Covid-(created) backlog and shipping delays has led to a disruption.

“I would like to think that shortage in supply this year will benefit volumes in 2022 when the order backlog improves.”

For Adamas,which handles the fabled UK sportscar marque Lotus, it will also mean introducing a new automotive brand into the market, Ineos, and the first model from its production-line, the all-rugged Grenadier. “We’ve already pre-sold 150+ Grenadiers,” said Hamer. “We see a very strong 2022, as we forecast a strong line-up, particularly in the EV sector.”

Stock - Ineos Grenadier
The INEOS Grenadier will be the latest brand and model to make an entry into the UAE auto market. Image Credit: Supplied

A 20%+ year

2022 is sure shaping up to be another 20 per cent plus growth year for new car sales. If all the production and shipments make it to UAE car showrooms at the expected time, growth could even zoom into 30 per cent range.

So, is it demand from individuals or fleet owners that is fuelling the current growth? According to Rajaram, this is not a detail that has him thinking. Whether the car is bought as a rental or for monthly “subscription” services, “the providers have to come to us to purchase the cars anyway.”

Sign the deal, have the vehicles exit the showroom – and then wait for the next customer. The wait will not be long and that’s why 2021-22 will be the comeback years for UAE car sales. After a relatively slow five years, the UAE car market is revving up…

Stock - Karl Hamer of Adamas
Karl Hamer of Adamas Consultants: "The customer will always require a physical in-store journey where the customer experience is still vital. The consumer still requires a test drive, the feel of the brand environment, and - most importantly - to feel part of the brand that they drive." Image Credit: Supplied