Boston, MA -- (SBWIRE) -- 03/12/2013 -- Executive Summary

BMI's long held view about the UAE offering one of the most promising growth prospects for autos sales in the Middle East is beginning to play out, with new vehicle sales expected to grow by a robust 9.5% year-onyear (y-o-y) in 2012 (according to BMI forecasts). In addition to strong domestic demand conditions, we highlight increased migration as one of the potent factors driving growth in the sector in the short term.

During the remainder of the forecast period to 2016, we believe that strong economic growth, coupled with improved access to auto financing will help the sector maintain average growth of 11.6% y-o-y between 2013 and 2016. At this rate, annual new vehicle sales in the country by 2016 will have increased almost 70% compared with 2011 levels, while overall vehicle ownership level will have reached 305 cars per 1,000 people.

Although the market for volume cars have undoubtedly expanded, UAE continues to prove to be an attractive destination for luxury vehicle manufacturers. November 2012 saw the launch of the world's largest Audi showroom in Dubai by locally based automobile distributor Al Nabooda Automobiles. In the same month, automobile dealer Arabian Gulf Mechanical Center (AGMC) launched its first facility in Fujairah as a part of the dealer's strategy to invest in the sales growth of BMW Group brands and offer convenient services to its customers in the Northern Emirates.

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Audi claims to have sold 2,747 cars in the UAE during the first nine months of 2012, marking a 12.2% increase over the same period in 2011. Meanwhile, strong sales growth in the UAE helped BMW achieve an impressive 15% y-o-y increase in sales, to 15,805 units across the Middle East for the first nine months of the year. UAE alone accounted for some 48% of this sales.

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