Qatar is set to see more than 40% growth in auto sales over the next four years with total new vehicle sales expected to reach 143,774 units by 2019, a new report has shown.
According to BMI Research, some 101,982 private vehicles were registered in Qatar in 2014. The BMI calculations were based on figures from Qatar’s Monthly Statistics book, prepared by Qatar’s Ministry of Development Planning and Statistics.
This represented an annual increase of 8.7%, slightly ahead of BMI’s predictions of just over 6% growth.
“Looking forward, we continue to believe that the scene is set for good sales growth across both 2015 and 2016, with domestic demand and construction activity remaining underpinned by the government’s heavy public investment programme,” BMI said.
Although growth may then slow towards the end of the forecast period in 2019, BMI was still anticipating a robust 41% growth for auto sales over the 2015-19 period, taking total new vehicle sales to around the 143,774 unit mark.
With Qatar’s hosting of the FIFA 2022 World Cup having been confirmed by football’s world governing body FIFA in November 2014,BMI believes that population growth and progress on the government’s large-scale infrastructure programmes will drive both construction activity and the sustained expansion of the services sector.
All of which, BMI said suggests a “broadly supportive backdrop” to auto sales in Qatar over BMI’s forecast period to 2019.
For 2015, BMI is targeting 8.7% growth in overall new vehicle sales, to reach over 110,000 units. The passenger car and light commercial segment (+9%) will outpace the heavy commercial vehicle segment (+5%).
Overall, BMI’s Country Risk team continues to believe that Qatar’s economic prospects remained among the “most positive” in the region.
“We believe that the Qatari economy will continue to expand at a rapid pace over the coming years on the back of the government’s ambitious public investment programme. We forecast real headline growth of 6.6% and 6.1% in 2015 and 2016, respectively.
“Over the near term, we expect Qatar to sail through the current period of lower oil prices largely unscathed, with strong investment spending and the expansion of the services sector – on the back of a fast-rising resident population – continuing to drive rapid growth in the non-hydrocarbon economy,” BMI said.
In 2014, the construction sector recorded its best performance in recent years, expanding by 18% in real terms and accounting for a third of Qatar’s headline growth. This bodes well for the heavy commercial vehicles (HCV) sector in particular.
Notwithstanding the temporary boost to growth that will be provided by Barzan (the last remaining major oil and gas project under development), it is the construction, financial services, and hospitality sectors that continue to provide the most reasons for future optimism.
Turning to the outlook for private consumption – a key indicator of potential new vehicle demand – BMI expects Qatar to remain the outperformer out of the six GCC economies in terms of headline consumption growth, on the back of rapid increases in the resident population in preparation for the FIFA 2022 World Cup.
This is boosting retail sales and other services, a trend that will continue over the rest of the current decade. The May 2014 opening of the Hamad International Airport (HIA) to passengers will also give a sustained boost to economic activity.
Overall, BMI forecasts household spending to grow by 9.5% in real terms in 2015, maintaining the average rate recorded between 2009 and 2013. Gulf Times