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The Automotive Sector of the Middle East, sheds a new light on the automotive industry of this region, and its future. The report contains a wealth of insider information on all aspects of the industry, from assembly and after market to imports and retail. Hard facts, expert research and detailed analysis, together with valuable input from industry leaders makes The Automotive Sector of the Middle East the essential guide for anyone looking to do business in the region. Commissioned by the Financial Times (UK) and compiled and written by the Directors of CIP.

List of Contents

Executive Summary
SECTION 1:  Regional analysis 
Chapter 1:  
Introduction
Chapter 2:   The Vehicle Markets
Chapter 3:
  The Service and Parts Scene


Chapter 4:  Marketing
Chapter 5:  Personnel Matters
Chapter 6:  Political and Financial

SECTION 2:   Country Profiles

Chapter 1:      Afghanistan

            Note - the following sub-headings appear for each of the 22 countries:
After Sales
Agriculture

Automotive industry
Country statistics
Distribution
Economic and political factors 
Government
Grey imports
History
Local assembly and manufacture
Political and economic influences in the automotive industry
Quick Service

Regulations
Social factors
Technology and diagnostic tools
The next 10 years
The vehicle market
Used vehicles
Chapter 2:   Azerbaijan
Chapter 3:   Bahrain
Chapter 4:   Egypt
Chapter 5:   Iran
Chapter 6:   Iraq
Chapter 7:   Israel
Chapter 8:   Jordan
Chapter 9:   Kazakhstan
Chapter 10: Kuwait
Chapter 11: Lebanon
Chapter 12: Oman
Chapter 13: Pakistan
Chapter 14: Palestine
Chapter 15: Qatar
Chapter 16: Saudi Arabia
Chapter 17: Syria
Chapter 18: Turkey
Chapter 19: Turkmenistan
Chapter 20: United Arab Emirates
Chapter 21: Uzbekistan
Chapter 22: Yemen
Appendix 1: Country automotive sales analysis by segment
Appendix 2: Country-by-country comparison of key data
Appendix 3: Acknowledgements
Appendix 4: Useful addresses

 Extract Paragraphs - the following extracts are taken at random, from a few of the countries included, to try to give some idea of the depth of information available within this publication.

Azerbaijan -

Table S2.4: Azerbaijan industrial production

Sector

Statistics

Beer

419,000 hectolitres

Cigarettes

6,614m

Cotton consumption

30,000 metric tons

Tyres

485,000

Cement

1,507,000 metric tons

Leather footwear

11,340,000 pair

Soap, detergent

12,000 metric tons

Machine tools

3,392,000

Source: Authors’ compilation

 

 

 

 

 

 

 

 

 

Bahrain - There is an increasing interest being shown in LPG- and CNG-fuelled vehicles and it is expected that this trend will increase at an accelerating rate over the next decade, but the diesel versus petrol ratio is likely to remain relatively constant, with the possibility of a very slow move toward diesel. It is expected that there will be government pressure to encourage the use of unleaded fuel in the near future.

Egypt - Local assembly has had a significant influence on the market in the past as locally produced vehicles have been marketed at more competitive prices based on duty support for locally manufactured product. However, in the wake of the Asian economic crisis, many VMs are ‘dumping’ excess inventory into Egypt, which has resulted in imported vehicles undercutting those assembled in the country. This has been exacerbated by the increasing availability of small cars with engine sizes that can take advantage of the most beneficial duty structures.

Iran - There are three duty free zones – Kish Island, Qeshm Island and Chabahar Port – all situated on the south coast and connected to major international waterways via the Gulf and the Oman sea to the Indian Ocean. There is easy access to major air, sea and ground transportation routes at local, regional and international levels, with proximity to regional markets for the import of raw materials and intermediate or manufactured goods. There is also good access to local and neighbouring markets, especially those of western, southern and central Asia and the Gulf. They are supplied with reliable public utilities and services with availability of skilled and non-skilled manpower at wages competitive within the region. Good access to abundant energy sources including natural gas (second in the world) sand crude oil (fourth in the world). Unique in the Middle East, there is a wealth of mineral resources required for industrial production and export.

Israel - Languages spoken are Hebrew (official) and Arabic (used officially for the Arab minority). English is the most commonly used foreign language. Ethnically, the society includes the following groups: Jewish (83%), and non-Jewish (mostly Arab) (17%). Religious affiliations of the people of Israel include Judaism (82%), Islam (mostly Sunni Muslim, 14%), Christian (2%) and Druze and other (2%).

Jordan - On the majority of parts, duty is 30% of CIF value and GST is 10% of the CIF value plus duty. Rolling chassis for buses pay customs duties of only 20% of CIF but raw materials pay the applicable duties. The finished product attracts 10% sales tax. When this is compared with the 30% duty on imported buses (and since some components required have a 40% duty level), then there is little protection or support for the development of a local body assembly industry.

Kazakhstan - The climate is considered continental, with cold winters and hot summers. It stays arid to semi-arid, depending on the area of the country. Kazakhstan’s terrain ranges from low areas near the Volga River to the Altai Mountains. In between are the plains in western Siberia and the oasis and desert in Central Asia. Resources indigenous to the area include major deposits of petroleum, coal, iron ore, manganese, chrome ore, nickel, cobalt, copper, molybdenum, lead, zinc, bauxite, gold, and uranium.

Kuwait - The Sabah family has ruled the State of Kuwait since 1751. The 1962 constitution contains detailed provisions on the powers and relationships of the branches of government and on the rights of citizens. Upon the death of an amir, the crown prince assumes his position. A new crown prince is then selected by members of the Sabah family from among the direct descendants of Mubarak the Great. Under the constitution, the designation is subject to the approval of the National Assembly. Since independence, successions have been orderly, in both 1965 and 1978. The country was transformed into a highly developed welfare state with a free market economy.

Oman - Duties and taxes: Import licences are required for only a few restricted items, such as alcoholic drinks, firearms, narcotics and explosives. There is no sales tax but customs duty is 5% of the CIF value for new and used vehicles and parts.

Pakistan - Agriculture in Pakistan accounts for 22% of the GDP and over 50% of the labour force. The world’s largest contiguous irrigation system is in Pakistan. Major crops include cotton, wheat, rice, sugar cane, fruits and vegetables. Livestock products include milk, beef, mutton and eggs. Livestock raised includes poultry, goats, sheep, cattle and asses (totalling 186m head) Pakistan is self-sufficient in food grain production.

Saudi Arabia - Parts: Non-genuine parts are imported in vast numbers, container loads of brake linings alone arriving at the ports each month. Parts come from a variety of sources since Saudi, having the largest vehicle parc and the money to purchase parts, attracts product from virtually every source around the world. Initially the franchised dealers were blind to the threat and so made little attempt to counteract the increasing penetration of their market. However, as recession bites harder there is a growing awareness of the fact that the after sales departments must be the lifeline when new unit sales are depressed.

Turkey - Chrysler Kamyon (now Aksam), Turkey, was established in 1964 as a joint venture with Chrysler, but the latter sold its share to the local partners in 1978. The three key distributors each market the range of products under their ‘own’ dealer brand – Desoto, Dodge and Fargo. The product range includes 4-ton pick-ups in 4x2 and 4x4 single-cab and double-cab variants, a range of medium trucks and Hino heavy articulated and drawbar trucks up to 40 tonne GVW. Average share of the pick-up and truck market in Turkey is 20%. It has developed and manufactured its own product and has also assembled components from (and represents) Perkins Engines, UK; Dana Spicer, US; Eaton, UK; ZF, Germany; TRW, US; Automotive Products, UK and US; and Jellinghaus, Germany. In 1995, Chrysler Kamyon concluded a licence agreement with First Motor Company of Egypt to supply CKD truck and pick-up kits for local assembly.

UAE - The UAE labour force is employed in industry and commerce (85%), agriculture (5%), services (5%) and government (5%). It is estimated that 80% of the labour force is foreign nationals. Major industries include petroleum, fishing, petrochemicals, construction materials, some boat building, handicrafts and pearling. Export commodities are crude oil, natural gas, re-exports, dried fish and dates. Major export partners include Japan, Singapore, South Korea, Iran and India. Import commodities are manufactured goods, machinery and transport equipment and food. Major import partners include the US, the UK, Germany and Japan.

Uzbekistan -

Table A1.21: Uzbekistan automotive sales analysis by segment, 1995–97 (Continued)

 

1995 units

Class share (%)

1996 units

Class share (%)

1997 units

Class share (%)

1996–97 change

Change (%)

Top models: truck & bus

 

 

 

 

 

 

 

 

TP3: Chevrolet C20

0

0.0

2

100.0

0

0.0

-2

-100

TV1: Daewoo Damas

149

100.0

12,362

100.0

0

0.0

-12,362

-100

TV2: Chrysler Voyager

12

75.0

18

81.8

5

71.4

-13

-72

TV3: Toyota Commuter

13

40.6

13

72.2

12

70.6

-1

-8

TU1: Daewoo Labo

0

0.0

1

100.0

65

97.0

64

6,400

TU2: VW Transporter

0

0.0

2

100.0

4

100.0

2

100

TU3: Citroen Jumper

0

0.0

0

0.0

1

100.0

1

T3: Iveco Fiat 35

0

0.0

0

0.0

14

100.0

14

T4: Mercedes-Benz 408D

0

0.0

0

0.0

40

100.0

40

T6: Nissan Diesel CLG

0

0.0

0

0.0

4

100.0

4

T7: Renault ME 160

0

0.0

2

50.0

0

0.0

-2

-100

T8: Nissan Diesel CWA

0

0.0

0

0.0

10

38.5

10

TB4: Daewoo B

0

0.0

4

80.0

0

0.0

-4

-100

TB5: Evo Various

102

100.0

0

0.0

52

100.0

52

Source: Authors’ compilation

Yemen -

Table S2.68: Yemen vehicle distributors

Distributor

Passenger Cars

Trucks

Make

Source

Make

Source

Abu Tawfeeq

Daewoo

South Korea

 

 

Adhaban Group

Dacia
Fiat
Mitsubishi
Renault
Subaru

Romania
Italy
Japan
France
Japan

Fiat
Mack
Mitsubishi
Nissan
Renault

Italy
US
Japan
Japan
France

Ahmad Awadh Badieb & Bros

 

 

Kia

South Korea

Althor Industrial & Trading Co.

GM

US

 

 

Al Ahwal Trading

Audi
Skoda

VW

Germany
Czech Republic

Germany

 

 

Al Husseini Motors

 

 

Isuzu
Saurer

Japan
Switzerland

Al Mutahar Group

 

 

Iveco

Italy

Al-Nasiem Al Thalathi Co. Ltd

Hyundai

South Korea

 

 

Al Rowaishan

BMW
Chrysler
Jeep
Land
Rover
Rover

Germany
US
US
UK
UK

International

US

Al-Shaqqa

 

 

Hino

Japan

Al Thour & Sons

Chevrolet
GMC

US
US

Hyundai

South Korea

Al Watary Group

Honda

Japan

DAF

Holland

Badeep Corporation

Asia
Kia

South Korea
South Korea

Asia
Kia

South Korea
South Korea

Bahaj

 

 

Scania

Sweden

Bazara

Toyota

Japan

Toyota

Japan

Elaghil Group

Volvo

Sweden

Volvo

Sweden

Fernet

 

 

Tatra

Czech Republic

Laheb Agencies

Daewoo

South Korea

 

 

M Al Zubeiry

 

 

Saviem/ Berliet

France

National Trading Co.

Ford
Hyundai
Lincoln
Mercury

US
South Korea
US
US

Ford
Hyundai

US
South Korea

 
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