Global Market Research Reports : Ken Research: UAE Used Car and Auto Classified Market

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Sunday, October 24, 2021

Due to increased focus on health and hygiene post COVID-19 pandemic, UAE Used Car Market is expected to grow to ~AED 112 Billion in Revenue by 2025: Ken Research

UAE News - October 2021

“Shifting preference of consumers from availing public transportation to private vehicles fueled by the impact of COVID-19 has driven the growth of Used Car Market in UAE.”

Increased Awareness on Health and Hygiene: With the advent of COVID-19, consumers were witnessed to be more concerned on maintaining personal health and hygiene. Therefore they are preferring the option of private transportation rather than availing public transport system. The change in consumer’s behavior and preference is expected to act as an opportunity for the used car market in UAE. Due to weaker economic sentiment and financial constraint followed by the aftermath of COVID-19, consumers are not willing to spend a huge amount in buying new cars rather they are preferring to buy affordable used cars which helps them in maintaining their health by spending less. Therefore the future prospect of the industry looks strong wherein used cars players in the market could utilize this opportunity to integrate the market.

UAE Used Car and Auto Classified Market Outlook to 2025 ( Second Edition ) - Driven by Growing Expat population and increased Awareness on health and hygiene due to covid-19.

Technological Impact and Omni Channel Strategy: Technology has deeply impacted the used car market as it has altered the buying behavior of the customers. Most of the customer journey today begins with online search; hence it gives the retailers to mark their presence at the start of the customer journey. Currently many companies are using Omni channel strategy to reach out to the customer. The players in the market have realized the importance of a multichannel approach to sales wherein they provide seamless customer experience combining the use of digital as well physical platforms such as communication through mobile and laptop devices or brick and mortar space therefore formulating Omni channel strategies to reach out to customers. This type of channel is useful as the digital presence is an important parameter to improve the customer penetration while the physical presence helps in building of trust of the customers. The need of such Omni channel strategy would help the players in increasing their visibility in coming years as more and more customers adapt to the digital medium of buying and selling followed by the aftermath of COVID-19. The advent of digital technology has given varied domains to the customers which they can explore to find the most suitable way to buy a car. In general, the customer uses both the digital and the physical channel simultaneously in order to find the best product according to their needs.

Large Number of Expatriate Population: As of July 2021 it is estimated that expat population in UAE constitutes 88.6% of the overall population. Mostly expats in UAE are living for a specific duration of time till their employment contract expires. Due to this nature, these expats prefer buying a pre-owned vehicles rather than spending huge sum of money in buying a brand new car which has resulted in increased demand of used cars over the years. Affordability plays a deterministic role in choosing a used car over a new car. In coming years, the expat population in UAE is estimated to constitute 90% of the overall population which will keep the demand prospect of used cars at an all-time high.

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Value Added Services: Used car market players in UAE, in an effort to differentiate its offerings are providing a number of value-added services along with the used cars which serve as one of the major competition parameter in UAE. These value-added services include warranty, financing options, accessories and others. Many dealerships have tie ups with loan providing financing companies. These value-added services have a placebo effect on the assuring quality of the car in the mind of customers. Thus, help in creating a positive brand perception in front of the customers. These value-added services also prompt the customers to pay a marginally more while buying through a dealership. This trend will help in consolidating the market share of players selling via B2B/B2C channel in the market as players selling via C2C sales channel does not offer a wide range of necessary value-added services such as transfer of ownership, tax registration and payment, quality check and assurance and others. Thus, in the future value added service offerings would play a pivotal role in developing the demand ecosystem of used car market.

Expo 2020: In recent years, UAE has been initializing the process of shifting away from oil dependence and enhancing its economic capability to develop others sectors, such as tourism, IT, pharmaceuticals, automotive, real estate etc. Therefore Expo 2020 is seen as a platform which will contribute to major investment opportunities in diversified sector of UAE especially Dubai. Automotive sectors in UAE is a growing industry wherein most of the cars are imported from Japan, Germany, America, and South Korea among others. Therefore, expo 2020 will act as a platform to develop and attract investment in the automotive sectors coupled with efficient technological solution, which will change the ecosystem of the industry. With the structural change in automotive sector, there is a greater possibility to enhance the capability of used car market in Dubai wherein players in coming years would look forward to adapt to effective digital solutions to attract consumers and participate in growing the used car market in UAE.

The report titled “UAE Used Car and Auto Classified Market Outlook to 2025” by Ken Research suggested that the used car market in UAE is expected to grow further in the near future, with the increased awareness on health and hygiene followed by the onset of COVID-19, thus showcasing a change in consumer preference from availing public transport to private transportation medium. Large number of expatriate population along with export prospects of used car in UAE will be major growth drivers for the market in coming years. The market is expected to register a positive CAGR of 16.6% in terms of revenue during the forecast period of CY’20-CY’25.

Key Segments Covered in UAE Used Car Market

Used and New Cars Re-Export by Country
UAE Free Zone
Saudi Arabia
Iraq
China
Oman

Used and New Cars Export by Country
UAE Free Zone
Mali
Sudan
Somalia
Congo

By Type of Car
SUV/Crossover
Sedan
Coupe
Hatchback
Pickup Truck
Sports Car
Convertible
Other (Utility Truck, Van, Wagon etc.)

By Type of Manufacturer on the basis of Region
Japanese
German
American
Korean
British

By Region
Dubai
Sharjah
Abu Dhabi
Umm Al Quwain
Ras Al Khaimah
Fujairah
Ajman

By Sales Channel
Online Marketplace Players including Classified Channel
B2B/B2C Dealers
C2C – (Word of Mouth)

Key Target Audience

Used Car Dealerships
Classified Used Car Retailing Websites
Online Marketplace Websites dealing in Used Car
Auction Players
Used Car Financing Companies
Government Bodies
Investors and Venture Capital Firms
Used Car Associations
Used Car Buyers
Used Car Sellers

Time Period Captured in the Report:

Historical Period: 2015-2020
Forecast Period: 2020-2025

Used Car Companies in UAE:

Dealerships
Al-Naboodah Automobiles
Arabian Automobiles
Al-Tayer Motors LLC
Al-Ghandi Auto Group
Online Marketplace Players
Al-Futtaim Automall
Gargash Motors and General Trading LLC
Alba Trading FZC
Cars24
The Elite Cars
Swaidan Motors
Galdari Pre Owned
Autotrust
SellAnyCar
Car Switch
Classified Companies
Dubizzle
Yalla Motor
Dubicars
Carmudi

Key Topics Covered in the Report

Value Chain Analysis of UAE Used Car Market
UAE Used Car Market Ecosystem
Customer Profile of UAE Used Car Market
UAE Used Car Market Size, 2015-2020
UAE Used Car Market Overview
UAE Used Car Market Size by Transaction Value and by Sales Volume, 2015-2020
UAE Used and New Cars Re-Export by Value and by Country, 2015-2020
UAE Used and New Cars Export by Value and by Country, 2015-2020
UAE Used Car Market Segmentation, 2020 (by type, manufacturer, sales channel, region age)
Competitive Landscape of UAE Used Car Market, 2020
Parameters of Competition of UAE Used Car Market
Market Share of UAE Used Car Market Players – (Dealership Network, Online Marketplace Players and Classified Companies)
Company Profiles of Arabian Automobiles, Al-Naboodah, Al-Tayer Group, Dubizzle, Yalla Motor, DubiCars, Carmudi, Al-Futtaim Automall, Elite Cars, SellAnyCar, and Car Switch
Trends and Developments in UAE Used Car Market
Growth Drivers of UAE Used Car Market
Challenges and Restraints in UAE Used Car Market
SWOT Analysis of UAE Used of Market
Porter 5 Forces Analysis of UAE Used Car Market
Government Regulations in UAE Used Car Market
Recent Developments in UAE Used Car Market
Channels Used for Selling Pre-Owned Cars in UAE – (Dealerships, Classifieds and Online Marketplace)
Impact of COVID-19 on UAE Used Car Market
UAE Used Car Market Future Outlook and Projections, 2020-2025E
Analyst Recommendations
Macro-Economic Factors Affecting Used Car Market in UAE
Directory of Automotive Dealers in Luxury Segment in UAE

Future Potential Market of LEVs in Last Mile Delivery Industry in KSA – Favorable Government Policies and Better Charging Infrastructure Availability to drive the LEV Sales in KSA Market

Malaysia Used Car Market Outlook to 2025 (Second edition) – Growth of Online Used Car Platforms and increased shift from using public transport to personal cars, fueled by Covid-19 to accelerate Industry's Growth

Contact Us:-

Ken Research

Ankur Gupta, Head Marketing & Communications

support@kenresearch.com

+91-9015378249

Tuesday, October 12, 2021

UAE Used Car and Auto Classified Market Size 2021 COVID-19 Impact Analysis by Business Opportunities, Applications, Growth Drivers, and Future Outlook till 2025: Ken Research

The report titled “UAE Used Car and Auto Classified Market Outlook to 2025 (Second Edition) - Driven by Growing Expat population and increased Awareness on health and hygiene due to covid-19.” provides a comprehensive analysis on the status of used car industry in UAE. The report covers various aspects including volume of used cars & market size, export & re-export of used and new cars by transaction value & by country, trends & developments, growth drivers, issues & challenges faced by the industry, government regulations, challenges & restraints, SWOT analysis, Porter 5 forces analysis, recent developments and other aspects. Further, the report focuses on the UAE Used Car Market Segmentation by Type of Car (SUV/Crossover, Sedan, Coupe, Hatchback, Pickup Truck, Sports Car, Convertible, and Others), by Manufacturers on the basis of Region (Japanese, German, American, Korean, British, and Others), by Region (Dubai, Sharjah, Abu Dhabi, Umm Al Quwain, Fujairah, Ras Al Khaimah, and Ajman), and by Sales Channel (B2B/B2C Dealership, Online Marketplace including Classified Platforms and C2C-Word of Mouth by sales volume and transaction value). UAE Used Car Industry report concludes with projections for the future of the industry including forecasted sales revenue and volume by 2025, Covid-19 impact, and analysts’ take on the future and directory of automobile dealers in luxury segment in UAE.

UAE Used Car Market Overview and Size

UAE is one of the biggest automobile markets in the industry. The market of used cars has grown at very fast pace in the last few years. The market size by value has registered a five-year CAGR of xx% (2015-2020) as the total value of sales increased from AED xx Billion in 2015 to AED xx Billion in 2020. The market size by volume increased from xx cars in 2015 to xx cars in 2020 while registering a five-year CAGR of xx% in the period. The market had initially slowed down in between 2015 and 2017 due to fall in export value of crude oil in 2015 oil which adversely impacted the purchasing power of consumers. However, since 2017 the market had witnessed tremendous growth. There are a number of growth drivers which has resulted in expansion of the market; these include improving quality of used cars and large number of expatriates among other determinants. There have been a number of regulatory changes that have impacted the market such as the imposition of VAT of 5% for sales of used as well as new cars in 2018. There are a number of challenges that exist for the market such as price discrepancies, lack of standardization and others. Customers of the used cars can be divided according to their needs. The passion for cars in the country is one of the biggest reasons that more and more players are entering the market. Further, the used car market can be segmented on the basis of import, export and re-export of used car sales based on brands and countries. In recent times manufactured certified cars are gaining foothold in the market as they provide reliable quality of cars.

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UAE Used Car Market Segmentation

By Domestic Sales by Market Structure: the domestic used car market of UAE has been segmented on the basis of channels of distribution. The channels of distribution are B2B/B2C dealerships, online marketplace platforms including classifieds and C2C (word of mouth). Online marketplace platform including classified sales have an outright market share of xx% followed by xx% market share for dealership and the rest xx% is with C2C channel in 2020.

By Domestic Sale by Type of Car: Among this segment SUV/crossover used cars are the market leaders with ~xx% of the market share in 2020 followed by sedan, coupe, hatchback, pickup truck, sports car and convertible. SUV are one of the most common types of cars that are sold in the market.

By Domestic Sale by Type of Manufacturer: The Japanese manufactured used cars enjoy the market leadership with xx% of the total market by volume in 2020. It is followed by German manufactured cars with xx% of market share and American manufactured cars with market share of xx% of the total market as of 2020. The domestic sale of used car is segmented into Japanese, German, American, Korean, British, and others.

By Domestic Sale by Region: The country is divided into seven emirates (Dubai, Sharjah, Abu Dhabi, Umm Al Quwain, Ras Al Khaimah, Fujairah and Ajman). Dubai has the highest market share by volume of used cars accounting for xx%, followed by Sharjah with xx% of the overall market, and Abu Dhabi with xx% market share in 2020.

Competitive Landscape in UAE Used Car Market

The competition in the market is highly fragmented with no single player accounting for majority market share in UAE. There are three sales channels used by the players i.e., dealerships, classifieds and online marketplace platforms. Most of the online marketplace players operates via both online medium as well as through physical retail outlets such as Al-Futtaim Automall. There are more than 400 dealerships in the market with Al- Naboodah, Al-Tayer and Arabian Automobiles as some of the biggest players in the market. Classified platforms have grown in number and currently there are more than 40 online portals in the market. Dubizzle, Dubi Cars, Carmudi and Yalla Motors are some of the biggest online players in the market. Dubizzle is the market leader with xx% of the market share under the segment of classified platform in UAE. The companies compete with each other on the basis of prices; value added service, brand reputation, digital presence and others. Many companies are trying to attract the customers through sales promotion. The cars dealers generate revenue by buying a car at low price, refurbishing the car and selling the car at markup prices. The competitive scenario is expected to intensify in the near future as the market gathers momentum. The dealerships are expanding their retail space as the aesthetics and decorum of the retail outlet are few parameters which the dealerships are expected to use to differentiate themselves from the competitors. Moreover, the advent of COVID-19 has enabled the customers in adapting to the digital medium wherein these individuals are better suited to make purchasing and selling decision through online mode. Therefore, used car sales through online marketplace and classified platforms are expected to record massive growth in coming years. For gaining advantage in this domain, these players are offering services such as doorstep delivery, inspection of cars at home etc., which is better suited to the customers as there is resistance in travelling to a retail outlet as it is time consuming and fear of contracting COVID-19. Cars24, a leading online marketplace player in India have expanded their business in UAE since April 2021 to capture the increasing demand of used cars in UAE thereby, generating massive revenue in the upcoming years.

UAE Used Car Market Future Outlook and Projections

The market size by value is expected to grow at a five-year CAGR of xx% increasing from AED xx billion in 2020 to AED xx billion in 2015. The market size by volume is expected to grow at a five-year CAGR of xx% from 2020 to 2025 increasing from xx cars sold in 2020 to xx in 2025. Revival of the country’s economy followed by the aftermath of COVID-19, adaptation of digital medium, increasing demand of private ownership, increased awareness on health and hygiene due to the onset of COVID-19 resulting in increasing demand of private transportation medium, increasing competition are some of the factors which will help the market to grow in the future. A number of operational and marketing changes are expected to happen in the market as the companies are becoming more and more customer centric. The market size by sales volume of online marketplace platform including classified players will surge at a 5-year CAGR of xx% from 2020 to 2025. On the other hand, the market size by sales volume via C2C (word of mouth) channel will shrink at a five-year CAGR of -xx% in the same period. The domestic sales by region will grow at the fastest rate in Sharjah followed by Dubai and Abu Dhabi, while the demand in other emirates will almost remain constant.