Qatar Autos Report Q3 2012

The Qatar Autos Report provides industry professionals and strategists, corporate analysts, auto associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Qatar's automotive industry.

There are no comprehensive and reliable vehicle sales and import statistics currently available for Qatar,
which has only a very small car industry, owing to its low population (1.9mn in 2011). However, some local dealerships do release their sales figures, making it possible to get a partial handle on local vehicle demand and the overall direction of sales and imports.

In this context, in February 2012 local dealer Alfardan Automobiles, the exclusive importer of German premium carmaker BMW's vehicles in Qatar, announced that sales of its BMW and Mini vehicles grew by 26% year-on-year (y-o-y) in 2011. The rise in sales signifies the potential of the domestic market and the rising demand for BMW cars in the country. Sales of the top-selling BMW model – the BMW 7 Series – increased by 63% y-o-y. This was followed by the BMW 5 Series with a 30% y-o-y rise in sales.

The Mini brand continues to attract car owners in the country, with 30% y-o-y annual sales growth during 2011.

Looking at trends so far in 2012, in April 2012 Alfardan announced its sales for the first quarter. These showed a 30% increase in annual sales of BMW and Mini vehicles, according to a report in Gulf News.

The 7-Series continues to be Alfardan’s top-seller, with strong growth also seen by the 5-Series (up by 104% y-o-y) and the X5 (up 57% y-o-y).

Mini recorded 88% growth in annual sales over Q112, with the Countryman model being the most popular sold within Qatar. In January 2012, Mini launched its Roadster model onto the Qatari market.

Certainly, there are reasons for continued optimism on the outlook for the Qatari new car sales market at present, with another year of double-digit growth in overall vehicle sales looking likely. BMI’s Macroeconomic team is forecasting real GDP growth of 7.9% and 6.9% in 2012 and 2013 respectively,
indicating that Qatar will remain a regional outperformer this year. Despite lower projected growth in hydrocarbon production, elevated oil and gas prices will allow the government to step up its expansionary fiscal policy. This trend will support strong levels of domestic consumption and gross fixed capital formation, while a solid macroeconomic backdrop and the government's strong financial cushions will minimise risks over the short term.

Beyond 2012, BMI forecasts Qatar's economy to expand at an annual average rate of 5.7% over the 2013-
2016 period. Massive hydrocarbon wealth will allow the country to maintain high fiscal stimulus, even as oil and gas prices are projected to trend lower over the medium term. In addition, the government's heavy investment in infrastructure, particularly in advance of the 2022 World Cup, will allow the non-oil economy to grow at a rapid clip over the medium term.

Further boosting demand for new cars was the government’s decision in September 2011 to implement an across-the-board wage hike of 60% for all government workers, on top of similar hikes in pensions and other social benefits. These wage hikes will mean significant increases in Qatari disposable income,
which will likely result in higher car sales over the coming quarters. Given political unrest elsewhere in the region, we expect the government to maintain high levels of spending in order to reduce the chance of any civil disturbances within Qatar itself. Our expectations therefore are that there should continue to be strong and steady growth in new car sales within Qatar in 2012 and beyond.

2012 Motor Show A Success In January 2012, Qatar hosted the second Qatar International Motor Show, which had more exhibitors than the inaugural event in 2011. Among the new exhibitors for 2012 was Italian luxury carmaker Ferrari, which launched the event with an F1 car demonstration run from test driver Marc Gene. Ferrari was joined by other leading luxury brands including Aston Martin, Bugatti, Maserati, Mercedes,
Porsche and Range Rover.

German company Volkswagen (VW) launched its new 2012 Passat sedan at the motor show, with subsidiary company Audi also launching four new models, the S7 and S8 sports sedans, the RS5 sports coupe and the limited-edition R8 GT Spyder super sports car, of which only 333 will be made. Porsche also launched its new Panamera four-door sports coupe at the event.

It is not only the high-end players that are seeing Qatar as a lucrative sales market. According to a report by the Qatar News Agency, Renault has plans to double its sales figure in Qatar from the 800 units it sold in 2011, with its sister company Nissan Motor also having similar plans.

Underlining the importance of the event to the local car industry, a representative of Saad Buzwair Automotive (the sole distributor of VW/Audi vehicles in Qatar) was quoted by the Qatar News Agency as saying that ‘close to 70% of inquiries we received [over the course of the motor show] were from serious buyers’. An official from National Car Company (the distributor of Hyundai Motor vehicles)
said that the motor show is an important event to showcase new models, such as the new Genesis Prada,
according to the same report. SHOW LESS READ MORE >

SWOT Analysis 6

Qatar Autos Industry SWOT 6

Qatar Political SWOT 7

Qatar Economic SWOT 7

Qatar Business Environment SWOT 8

Global Overview 9

Global Autos Update: End Of First Quarter Brings Both Positive And Negative Revisions As Key Trends 9
Table: : Passenger Car Sales (Units), Jan-March 2012 9

Industry Risk/Reward Ratings 13

GCC States Defy Lack Of Production To Top Autos Ratings 13
Table: Middle East And North Africa Autos Risk/Reward Ratings 15

Regional Overview 16

SUVs In Demand At Both Ends Of The Spectrum 16

Macroeconomic Forecast 18
Table: Qatar - Economic Activity 20

Industry Forecast Scenario 21
Table: Qatar Automotives – Trade And Car Ownership Rate, 2010-2016 21

Recent Developments 23

Electric Vehicles 26

Competitive Landscape 29
Table: Qatar – Top 10 Best-Selling Models 2011 29

Strategic Development: Influence of Sovereign Wealth Investment 31

Suppliers 34

Company Monitor 36

Record BMW Sales Reflect BMI Views 36

Company Profiles 38

Qatar Automobiles Company 41

BMI Methodology 42

How We Generate Our Forecasting Model 42

Sources 42