28 December 2009

The UAE Car Market: 2002-2008

According to Wikipedia, the United Arab Emirates (UAE) is a federation of seven emirates situated in the southeast of the Arabian Peninsula. The UAE consists of seven states, termed emirates, which are Abu Dhabi, Dubai, Sharjah, Ajman, Umm al-Quwain, Ras al-Khaimah and Fujairah. The capital and second largest city of the United Arab Emirates is Abu Dhabi. They also buy cars, which is where my interest comes in.

The UAE sales are from 2002 to 2008. In 2002 there were 120,000 vehicles sold in the UAE, and by 2008, that had gone up to 360,000, an increase of 200%. Toyota is the largest brand in the Emirates. It had 30,000 sales (24.5% market share) in 2002 and by ‘08 sold 91,000 (25.3%). Nissan is second with sales going from 34,300 (28.4%) to 54,300 (15.2%). Others were:

3 Mitsubishi 8,400 (7.0%) and 43,600 (12.2%)
4 Honda 10,500 (8.7%) to 23,600 (6.6%)
5 GM 4,500 (3.6%) to 23,400 (6.5%)
6 Hyundai 2,500 (2.1%) to 15,100 (4.2%)
7 Chery new (0%) now 13,900 (3.9%)
8 Kia 1,800 (1.5%) to 10,300 (2.9%)
9 Mazda 3,600 (3%) to 9,000 (2.5%)
10 Mercedes 2,800 (2.3) to 6,800 (1.9%)

The market is strongly Japanese, Toyota top and looking comfortable. Oil rich economies in the Middle East area have vehicle sales growing quickly. Maybe it's time they were a little more transparent reporting the figures as they are increasingly important players in the world's car industry.

The bottom line: I would love to visit the UAE, especially Abu Dhabi.

PS. Sales figures have been modified.

12 September 2009

BMW's Shame

Once upon a time BMW decided it needed to expand its interests, like many other car companies were doing. It saw MG Rover as that timely expansion. MGR was a small company with a successful tie-up with Honda. The major shareholder was BAe and Honda had a minor share. MGR shared much with Honda, crucially platforms. Its success depended on the costs saved. BMW bought BAe's share of MGR and looked forward to the continued joint venture between MGR and Honda.

However, BMW didn't ask the very private Honda if it wanted BMW's involvement. Honda didn't mind BAe, as it was an aerospace company and its technologies were of no interest to it. BMW was a different kettle of fish. Honda didn't want a car company involved and pulled out. BMW's cars are rear wheel drive so platforms could not be shared with MGR's front wheel drive range. MGR was too small to stand the cost of designing platforms for just itself. Without the cost savings of the Honda joint venture, financial losses followed and BMW showed little patience.

BMW was too proud to admit mistake of not checking with Honda before acquiring MGR. It instead poked fun at the sick 'English patient'. MGR was fine when they bought it, but it was now a liability. However, BMW didn't want to be the company that crashed MGR, so they worked out how much money it would cost to wind it up and paid that amount over to the new owners, some former managers. It seemed they wished MGR well. Ah, but they took the plans for a new model with them (which was nearing completion) back to Munich. It was of no use to them, but essential for MGR's survival, as a new car was desperately needed. The new owners had neither the time nor money to do a new car. Thousands of workers lost their jobs and a piece of motoring history ended. BMW should have stood by their mistakes and put it right. Shame on you BMW.

24 July 2009

Cash For Clunkers/Scrappage Schemes

In Europe, governments have tried to stimulate car sales with incentives to get people buying them in greater numbers. The German market has gone through the roof, such is its success. In other markets the reaction has been more moderate, although these schemes do get Joe Citizen into showrooms in larger numbers. Some manufacturers have gone beyond what the government offers; to sweeten the deals even more. The terms surrounding the enticements favour smaller and more environmentally friendly cars.

The US is embarking on a 'cash for clunkers' deal now and it will have some success for smaller cars, most of which I assume will be imported. The Korean car industry will be rejoicing, as it already has scored well in Europe over this and should do likewise in the US of A.

I cannot help but think that unless economies strenghen quickly, the slump after these deals end will be large indeed. I also wonder about the environmental benefit of encouraging more cars on to congested streets. The downturn has actually been good for the earth. Making more cars isn't. So it seems what is good capitalism is not so for the planet.

The bottom line: What a mess man has got into.