While the developed vehicle markets struggle to maintain its growth pace amid the challenging environment, there are new players in the market, emerging as game changers. According to JATO’s latest research, the Gulf Cooperation Council (GCC), and in particular, the Kingdom of Saudi Arabia is becoming a key hub for the production of new cars and development of new technologies. Figures indicate that big opportunities will emerge from this region.
“In line with our commitment to support customers wanting to take advantage of new opportunities, we continue to monitor market trends in Saudi Arabia and the GCC, while bringing new solutions in anticipation of upcoming challenges,” said Vassilios Dais, JATO’s President Middle East and Africa –overseeing the launch of the “KSA database” product.
Competitive market size
With a market size equating to that of Mexico or Spain, and even larger than Turkey and Indonesia, the GCC represents a big opportunity for all OEMs and OES, seeking to expand their businesses. Last year, during the pandemic, sales of new vehicles in the GCC market totalled more than 835,000 units – making it the 19th largest in the world. This year - through July – the six countries that make up this region sold more than 570,000 new vehicles, trailing Mexico, Australia and Spain.
Accounting for 57% of this total, the Kingdom of Saudi Arabia is without a doubt a protagonist behind this boom. “The Kingdom of Saudi Arabia plays a major role in the region’s attempt to become an industry leader,” Dais continued.
However, the high sales volume and strong expected growth are not the only factors at play.
More than 300,000 new vehicles to be produced
Under its “Vision 2030” plan, the Saudi government aims to reduce the dependence on oil exports, instead focussing on alternative industries and sectors. The plan includes the production of more than 300,000 vehicles in the country between 2020 and 2030.
Authorities in the kingdom are already making moves towards this. For example, there negotiations are taking between Lucid Motors – the emerging American EV maker - and the Saudi government to build an electric vehicle facility in the country. Toyota, the market leader in both the country and region, also signed a memorandum of understanding to conduct a feasibility study for the establishment of a vehicle manufacturing plant.
This comes in addition to the plant that the Japanese maker, Isuzu, already operates - with a capacity of 25,000 units per year. Three other major global OEMs have production facilities, manufacturing heavy duty commercial vehicles in Saudi Arabia. They are Mercedes, Volvo and MAN. The current total production of all four OEMs is in the range of 12,000 units and is expected to reach 39,000 by 2022.
Car production is part of a much bigger picture that aims to create an automotive cluster, including research and development, design, components, sub-systems and sub-assemblies manufacturing, full vehicle assembly, and logistics.
Identifying opportunities
The upcoming plans require in depth understanding of market trends and dynamics of this industry. With our vast experience in market research and automotive business intelligence’, JATO’s team in the Middle East has been working on a new solution that responds promptly to the market events and ensures up-to-date information collection.
Our database for the Saudi Arabian market focuses on passenger cars and light commercial vehicles in the below main aspects:
• Specifications
• Prices
• Public incentives
“This new dataset responds to a need expressed by local distributors and Middle East offices, as Light Commercials are playing an important role in the financial expansion of the Kingdom, and their commercial vehicles sales” noted Dais, following requests from various industry players, such as Nissan Saudi Arabia, Ford Middle East and Abdul Latif Jameel – one of the leading independent Toyota distributors in the world.
Our researchers scan the market continuously for changes, code them according to JATO’s definitions and specifications, and make physical inspection in the showrooms. This allows us to provide standard equipment and options data for 1,318 items in the passenger cars market, and 1,139 in the light commercial vehicles market. The incentives solution takes into account the price structure of Saudi Arabia.
These features work not only for the Saudi market but for the rest of the GC, as they share the same specifications, price structure and taxation.
JATO is currently doing an ad-hoc project based on mystery shopping, data analysis and reporting for local importers and OEMs in the Middle East and North Africa regions.
-Ends-
About JATO
JATO Dynamics, founded in 1984, now has representation in over 51 countries around the world. We provide precision under pressure, providing the world’s most timely, accurate and up-to-date automotive information on vehicle specifications, pricing, sales and registrations for over 30 years. We offer more than just data, as we’ve watched the world change, and consumer mindsets alter with it we have been able to offer insights that help inform the industry. We’re able to react to short-term market movements, plan for long-term developments and ultimately to meet the needs of our clients. Visit JATO at www.jato.com for more information
Contact:
Harri Thomas, +44 771 463 7265 / Isobel Tennison, +44 7760 492 005, jatoteam@firstlightgroup.io
Kholoud Omari, +971 50 457 7344, kholoud.omari@jato.com
© Press Release 2021
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