Cars have always enjoyed a very lucrative and dynamic marketplace in UAE, demand and supply wise, when compared with any other country in the world.
For example, used cars in UAE are generally much more expensive than used cars in Latin America, Asia, and Africa.
A 2014 report by auto marketplace Carmudi.com, revealed that used cars in UAE cost an average of AED 90,000 ($24,500), more than other cars in other markets.
The report also revealed that car owners in the UAE generally change their car three times more their peers living in other places of the world.
Owners quickly changing their cars in UAE, why?
Many people in the UAE have a higher income than people in other countries. Getting a car loan is guaranteed to be accepeted by UAE banks. This drives many UAE expats to buy their dream cars. Rinse and repeat!
With this disposable income along with consistent offers from dealerships and banks, the car is still relatively young when their owners want to give them up.
The high cost of maintaining new cars in UAE
New car owners in UAE quickly discover to the sad fact…
…Maintaining a new car with its dealer costs an arm and a leg.
No, this is not a figure of speech, this is a fact.
Yes, a new car owner can have his car serviced at a usual car shop, but if he / she does this twice, the car’s warranty is void, as per the default new car’s contract used in the UAE.
People reach a point down the lifetime of a car where paying installments for a new car is equal to the costs of maintaining a used car.
Why bother? Buy a new car and sell the old one while it has some value remaining.
Thus, cars in UAE have a high resale value because of how young the cars remain.
The UAE stood on top of the world in new car sales growth rates during the first eight months of 2015, with an increase of 5.3%, compared to the previous year.
Japanese cars, the most popular used cars in UAE
Hands down, Japanese cars are the most popular used cars in UAE.
Corolla and Camry were the most popular Toyota brands visitors searched for.
That’s because those cars are reliable, affordable, and considerably the cheapest to maintain over time.
South Asian buyers are know to be die-hard fans of Japanese car brands.
This gives people with and without disposable income the chances of buying high-quality cars.
Toyota, Nissan, and Mitsubishi brands were all favored in polls done in the UAE.
Used cars in the UAE have by far the highest mileage per car, around 79,000 KM, while the global average hovers around 47,000 KM.
In the UAE, used cars which are two years old or less go an average of 47,000 km.
Five year old cars reach an average of 103,900 KM.
The report also found that Japanese used cars tend to have been driven further than brands from other countries.
Mitsubishi, Nissan, Honda and Toyota, among others, all range between 75,000 and 82,000 km.
Western cars were often less traveled; Ford, BMW and Land Rover averaged 61,000 km.
The wear and tear on Toyota cars are generally simple. Their average costs are really affordable compared to other cars.
Toyota customers also know that given its worldwide popularity, Toyota spare parts are everywhere and easy to find.
This makes it very easy for garages to fix the cars. In turn, this creates a big market for spare parts, new and used.
Australians used to brag about the top 10 classical cars manufactured down under!
The report also revealed that the Middle East/Africa and Latin America will have the strongest auto demands followed by Asia.
This explains why car dealers are reaching out to buyers through the internet now more than ever before.
About 88% of car dealers stated that they reached buyers via the internet.
This report also revealed that 52% of buyers were reached through social media and 48% through manufacturer sites.
On top of that, the UAE is also one of the largest importers of used-cars in the GCC region. This is per the UAE’s automotive sector overview report, published by EmiratesNBD bank early 2015.
Around 75% of UAE online consumers planned to buy a new or used car in 2016/2017, according to Nielsen’s Global Survey of Automotive Demand.
The survey polled over 30,000 internet respondents in 60 countries.
28% of UAE respondents said they will buy a used car in the next two years.
47% of them said they plan to buy a new car.
Rise of eCommerce cars sites
People are now relying on websites to choose, compare, and buy their next car.
Some eCommerce statistics showed that 40% of international internet users have purchased items online via their tablets, mobile phones, PCs, and other devices.
New shipping and payment options in the emerging automobile market will make this even more popular in the future.
Still, word to the cautious!
This lucrative UAE used cars market has also invited many scammers and liars. Buying a used car is not always a story with a happy ending.Many have reported discovering dirty secrets about their used cars. Specially the US imported ones, which most probably were part of a devastating crash, flooded, or worse.
This post was sponsored by OpenSooq.com