INDUSTRY SPOTLIGHT
MENA AUTOMOTIVE SPOTLIGHT Dissecting the automotive industry across the Middle East and Northern Africa, as it seeks to recover from the pitfalls of the COVID-19 pandemic and is fuelled by investment and innovation Writer: Phoebe Harper | Project Manager: Matt Cole-Wilkin
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growing industry composed of a network of manufacturers, importers, suppliers, professionals and consumers; MENA’s auto industry is in a state of flux. At present, the sector is defined by the tailwinds of a movement towards Autonomous, Connected, Electric and Shared Mobility vehicles (ACES), as the market continues to redefine itself in times of transition. Accompanying the drive for innovation, simultaneously, the sector is faced with navigating the aftermath of the pandemic which has triggered sector-wide disruption. As an industry defined by the traditional concept of the ‘handshake deal’, as with all consumer-facing industries that cannot rapidly respond to an online transition, automotive vendors continue to weather a significant slump in sales, fed by a weakened demand for transport corresponding with restrictions on global mobility. According to Arab News, in Saudi Arabia
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– previously recognised as the world’s fastest growing motor industry between 2010-2015 – new car sales fell by 60 percent during 2020 with a severe impact on the aftermarket as average spend per vehicle dropped by 25 percent. Indeed, across the MENA automotive market in general, third quarter sales across 2020 fell by 29.6 percent – despite every country recording a double-digit decline, Egypt alone reported positive growth. The general trend in market decline has been identified as a direct result of COVID-19’s impact on the economy. Within the region, the oil-rich country of the UAE has become notable for importing high-end sports vehicles, with an outlook to establish itself as a manufacturing hub for luxury sports cars over the coming decades. This falls within the greater aims of the Gulf Cooperation Council (GCC) region towards economic diversification. As such, this is a market poised for significant growth with Saudi Arabia and
