Credit crunch puts brakes on GCC car sales
Abu Dhabi, December 18, 2008
The global credit crisis will make 2009 a challenging year for car sales in the Gulf region, according to top carmakers in the region.
Land Rover, Mercedes-Benz of Daimler and General Motors are among those who have noticed a slowdown in the region during the past couple of months.
Record oil revenues fuelled an economic boom in the region in the last few years which also saw an exponential growth in sales of cars. But as credit becomes scarce, sales of cars will slow in the coming months.
"We have seen a slowing growth in the last few months and there's an uncertainty about next year which will be challenging," said Land Rover Middle East and North Africa managing director Robin Colgan.
"There's been a 10-15 per cent reduction in sales in the last two months due to a lack of financing from banks," said General Motors Middle East managing-director Mike Devereux.
"Up to last month, sales have been up 10pc to 134,000 vehicles in this region, an all-time record," he said at the Abu Dhabi Motor Show here.
The troubled US carmaker expects to grow its market share next year as it plans to roll out five to six new models, Devereux said.
He said that dealers in the region are continuing to support GM despite its problems in the US where it's awaiting word from the US government on billions of dollars in emergency loans it says it needs to avoid near-term collapse.
Chrysler is in a similar situation waiting to hear about possible US government emergency loans.
Indeed carmakers everywhere are under pressure to cut costs and save money as tight credit and weak consumer sales hit demand. And the Gulf is no exception.-Reuters