Auto sales in the GCC are expected to reach $17 billion in 2010, a marginal increase over the previous year, as car finance remains tight, Business Monitor International said on Wednesday. In a new report on the Saudi Arabian car market, analysts said its slow recovery was part of a general “stabilization” in sales across the region this year, following “tepid growth” in 2009. The BMI report said growth in the GCC would be “more robust” from 2011-14 with sales expected to reach $21.5 billion. “BMI expects that by the end of the forecast period, total sales should top 816,291 units, up more than 37 percent over 2009 levels. We expect growth in the commercial vehicle segment to be particularly strong over the next five years,” it said in its latest report. On car sales in Saudi Arabia, the report added that sales towards the end of 2009 were still depressed “due to macroeconomic factors”. It said that banks have tightened lending policies while households have also reined in their spending, resulting in dealerships cutting back on inventories. “The economy is expected to rebound this year, with gross domestic product forecast to expand 1.9 percent,” it said, adding that it saw lending for car buyers to “gradually return to normal”. Car loans are forecast to rise from accounting for fewer than 50 percent to more than 70 percent of car sales in the Kingdom, the report said. It said that consumers were turning away from the larger gas-guzzlers and were showing a preference for small cars, while demand for used cars was waning. Moreover, in Saudi Arabia, the market for fuel efficient compact cars is witnessing steady growth, according to Suzuki Saudia, the sole distributor of Suzuki vehicles in Saudi Arabia and part of Bamarouf Group. Suzuki Saudia's observation comes at a time when Suzuki's globally acclaimed compact car Celerio is seeing impressive sales in the Kingdom, complementing the fact that more than 100,000 units of the model were sold worldwide in just the first six months of its launch. “Traditionally the Saudi auto market has been known for its large sedans and SUVs. However, we have been observing a small but definite change over the recent years, with small and compact cars generating significant interest in the local market. Suzuki, with its wide array of cars in this segment, has seen its customer base in KSA growing steadily over the last few years. Suzuki Celerio, our recent introduction in the compact car category, in particular has witnessed excellent sales in the Saudi market due to its build quality, aerodynamic design, fuel efficiency, safety features and overall performance,” said Maher Al Nabawi, deputy general manager, Suzuki Saudia. The Suzuki Celerio comes with a naturally aspirated, 1.0L, 12-valve three cylinder, 67 horsepower engine. The compact dimensions of the engine block significantly contribute to reducing the weight of the car, which in turn results in increased fuel mileage. Also, the Celerio's Euro 3-rated emissions level is the best in its class. The full-option Celerio features a radio, CD and MP3 player; double airbags; an anti-lock breaking system; and power steering.
