Saturday, Jun 06, 2015
Dubai: One local retail category that has managed to hold its own against the euro volatility is car dealerships.
“A long time ago we decided to bill all of the inward shipments in dollars from our European principals,” said K. Rajaram, CEO of Al Nabooda Automobiles, the local dealership for Porsche, Audi and Volkswagen, “It meant that we managed to keep pricing consistent for the major part.
“If we hadn’t, and with the euro’s recent behaviour, we would have to make pricing adjustments every other week.”
Unlike most other retail categories, car dealerships and manufacturers are loath to see prices change every other quarter. Instead, the unwritten rule is that any model should be allowed to retain its value for the better part of the model year, ensuring that someone who buys early on do not have to see the same model going for a deep discount just months into its run. (The luxury merchandising is another retail category where ‘residual value’ trumps all other considerations.) “In recent months, we have added to the incentives/features offered with any car sold through out showrooms,” said Rajaram. “We have not slashed pricing on Audi or Porsche models … the only exception has been with VW and that’s because it’s a mass brand.”
By Manoj Nair Associate Editor
Gulf News 2015. All rights reserved.
