New women drivers to support 10 million vehicles on Saudi roads
Automechanika Jeddah organisers say women drivers creating automotive growth opportunities in the kingdom
The growing number of women drivers in Saudi Arabia is opening up the market for automotive parts and accessories, with millions of vehicles expected on the road in the next three years, new research has shown.
With three million new drivers expected by 2020 as Saudi women take the wheel, passenger sales vehicles are expected to grow at an annual rate of 8% by 2022, according to a white paper released ahead of Automechanika Jeddah 2019, to be held on 26-28 February in the kingdom.
Aranca’s white paper stated that the positive impact of lifting the ban on women drivers would be buoyed by “recovering oil prices and economic policies aimed at boosting consumer spending”.
The benefits will also extend to Saudi Arabia’s aftermarket, which in 2017 was valued at $7.4bn. In 2017, new commercial vehicle sales topped 110,000, with 438,000 new passenger cars sold during the year.
These figures will note phenomenal growth over the next three years, with Aranca forecasting 10 million vehicles on Saudi Arabia’s roads by 2022, of which 3.5 million will be commercial vehicles.
Tires remain a major revenue driver for automotive accessories companies in Saudi Arabia’s spare parts sector, accounting for $2.2bn of the market. Lubricants and batteries follow with respective market values of $1.4bn and $3.4bn. By 2022, Saudi’s spare parts market, expected to grow at a rate of 6% each year, is likely to be worth $9.8bn.
Aranca added that while automotive growth opportunities will span the kingdom, much of the potential lies in Makkah and Medina, where more than one million women drivers are expected by 2020.
Related automotive industry growth is anticipated as Saudi Arabian businesses diversify into women-only car showrooms, insurance options, and driving schools.
The organisers of Automechanika Jeddah said the kingdom’s market is ripe for automotive investments from both the Middle East and around the world. Automechanika Jeddah 2019 will see international pavilions dedicated to Turkey, Korea, China, Taiwan, and Hong Kong, with regional firms such as the UAE’s National Paints also expected to exhibit at the show.
Commenting on the upcoming event, Automechanika Jeddah’s show director, Mahmut Gazi Bilikozen, said: “The consumption of auto spare parts and services in Saudi Arabia will grow at a healthy rate in the coming years, aided by the addition of a whole new segment of the population that is now allowed to drive.
“Longer warranty periods, growing vehicle [numbers], and environmental factors that lead to high wear and tear on car parts also provide added impetus in the auto aftermarket, with Automechanika Jeddah 2019 presenting an unrivalled platform for global suppliers to tap into emerging opportunities.”