Weakening demand from the crisis-hit Gulf countries has turned the Middle East into one of the worst performing regions for vehicle sales this year, a new report has found.
According to BMI Research, Qatar’s auto market has particularly been hard hit by this summer’s dispute.
The group forecasted that the blockade would cause double-digit declines in sales for both passenger and construction vehicles in Qatar this year, to the tune of 18 and 15 percent, respectively.
In a statement, BMI explained:
“Overall, we believe that the Gulf diplomatic crisis — and resultant restrictions on cross-border movements of goods and people between Qatar and Saudi Arabia, the UAE, Bahrain and Egypt — will weigh on consumer and investor confidence in Qatar over the coming months, while also directly disrupting activity in certain non-hydrocarbon sectors.”
BMI added that declining tourism numbers are hurting rental car companies, which helps explain why the passenger vehicle market is faring worse than the construction sector.
“We expect the Qatari government to make efforts to ensure infrastructure projects linked to the 2022 FIFA World Cup and the national diversification program progress without substantial delay,” the report said.
It’s been a buyer’s market for cars in Qatar since at least 2015, amid energy sector layoffs that affected thousands of residents.
Qatar is no different in this regard than many other Gulf countries hit by lower global oil prices.
According to BMI, a region that was once a “safe haven for carmakers” is now the “worst performing globally in 2017.”
Going forward, BMI forecasts that new vehicle sales in Oman will fall some 25 percent this year, while construction vehicle sales will fall a whopping 43.8 percent in Saudi Arabia.
Are you buying or selling a car anytime soon in Qatar? Thoughts?