Demand for car ownership surged in UAE due to COVID-19: Survey

By Amirtha P S, Desk Reporter
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The pandemic-driven disruptions have led nearly 43 percent of UAE residents to think owning a car is now more important than it was before, against a global average of 48 percent, according to a new survey.

The Future of Automobility report by Boston-based consultancy Arthur D Little reveals the preferences of the UAE consumers, with 34 percent of the residents of the country placed the same amount of importance on owning a car as before the pandemic, while about 24 percent felt owning a vehicle was less important.

The consumers of UAE mentioned the necessity for a sense of security as one of the main reasons why they considered car ownership as more important, Joseph Salem, transportation regional practice leader at Arthur D Little, said.

Joseph Salem
Joseph Salem
Regional Practice Leader
Arthur D Little

“Since the COVID-19 outbreak, cars have played an even bigger part in people’s lives because of the protection and independence they offer. The protection we feel inside our socially distanced transport bubble, as opposed to using public transport, seems to be preying on the mind of the consumer more than ever before.”

The survey which included more than 8,500 participants from 13 countries, predicts that the annual sales of passenger cars will hover between 97 million and 103 million globally by 2030, which shows an annual growth rate of 2 percent but a “significant drop” compared with the consultancy’s last forecast two years ago.

Respondents increasingly see electric vehicles as commonplace and are less willing to pay a premium for them as a result. Nearly 25 percent of those polled stated that they would be willing to pay more for battery vehicles.

The world’s biggest car market China is leading the industry when it comes to adopting autonomous driving technology with over 70 percent of customers optimistic about it, compared to just 28 percent in Europe and 26 percent in the US.

Despite the pandemic-driven restrictions, nearly 55 percent of individuals prefer at least one personal or face-to-face consultation with a traditional dealer before purchasing a car. Of all surveyed countries, the UAE topped in terms of visiting car dealerships before buying a car. About 11 percent of buyers visited a dealer once, while 27 percent visited twice or three times.

“When it comes to arranging test drives and finalizing purchases, more than two-thirds of UAE respondents prefer person-to-person interaction, these aspects seem likely to remain in place regardless of a global pandemic,” Mr. Salem said.

Even though 71 percent of Chinese customers saying they would be willing to buy a car online, there is a growing acceptance of other retail methods globally, with 42 percent in the US and 35 percent in Europe preferring in-person purchase.

Related: Dubai experienced sharp drop in expatriate population due to COVID-19: S&P ratings