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GM Says Mideast 2011 Sales to Grow 22%
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By Ayesha Daya and Tamara Walid - Aug 10, 2011 1:19 AM CT
General Motors Co. (GM), the world’s largest automaker, expects company sales in the Middle East to grow 22 percent this year on stronger demand from Gulf nations and Iraq.
“Iraq has had a very strong performance so far this year, and it could be as large as Saudi Arabia,” John Stadwick, managing director of GM Middle East, said in an interview in Dubai yesterday. “The Middle East is a very compelling opportunity for us.”
GM sales in the Middle East, the company’s seventh largest market globally, rose 6 percent in 2010 from a year earlier to 123,258 vehicles, Stadwick said. Outside Brazil, Russia, India and China, also known as the BRIC countries, the Mideast has the largest growth potential over the next 10 years, he added. Overall auto sales in the region may rise 55 percent by 2020, he said.
Demand in the Middle East is rising as Iraq stabilizes and government handouts in Gulf nations encourage consumer spending. GM sold 80,487 vehicles in the region from January to July, with about half in Saudi Arabia, followed by Iraq and the United Arab Emirates. Iraq sales jumped 130 percent in the first six months.
Saudi Arabia and Kuwait announced domestic spending increases this year to counter political liberalization movements that toppled regimes in Egypt and Tunisia and are causing violent crackdowns in Libya and Syria. Kuwaiti citizens will get 1,000 dinars ($3,664) and free food for 13 months, state news agency KUNA said Jan. 18. Saudi Arabia’s King Abdullah offered 500 billion riyals ($130 billion) in February and March for housing, religious groups and the military as well as salary increases.
“As soon as the government announced handouts, people went out and bought cars,” said Stadwick. “We’ve seen a trickle- down effect.”
New Models
The carmaker plans to introduce four new models in the region in the next six months, including one in the truck segment, Stadwick said. It will also present a world premier in Dubai in November at the emirate’s Motor Show to enter a new market segment, he said, declining to provide details of the new vehicle.
The company’s dealers in the Middle East plan to spend $200 million on 12 new facilities, showroom renovations, and staff training from November to December, Stadwick added.
GM outsold Toyota Motor Corp. (7203) globally in the first six months to become the world’s largest carmaker after the earthquake in March disrupted production in Japan. GM sales rose 8.9 percent to 4.536 million units in the half-year ended June 30, the Detroit-based company said Aug. 4.
To contact the reporters on this story: Ayesha Daya in Dubai at [You must be registered and logged in to see this link.]; Tamara Walid in Abu Dhabi at [You must be registered and logged in to see this link.]
To contact the editors responsible for this story: Stephen Voss at [You must be registered and logged in to see this link.]; Benedikt Kammel at [You must be registered and logged in to see this link.]
