During the year of 2020, UAE’s sale for new car has been drastically dropped and fell on a negative value because of Covid-19 pandemic. Different car companies were affected and fall short of their market shares like Nissan, Toyota, Mitsubhishi, Honda, Hyundai, Lexus, Kia and others. Until now, the demandon new cars hasn’t been same as high like the previous years. Car owners opted to extend the use of their cars which is unlikely perceive in the past.
Car manufacturers and automobile industries on the other hand noted that there are shortages of newly manufactured cars due to the current situation and the impact of fuel price increase globally.Hefty amount on Freight and transportation are also challenging for car importers.Pre-owned vehicles also have high interest rates when availed by finance or loans which make it less attractive in the market.
For that reason, most of the car buyers choose to have second hand/used cars instead because it is comparatively cheaper than the new ones. As people are now unrestricted and flexible to move around be it leisure or work, the need for transportation is snowballing and also in the UAE, having personal car is necessity.
In line with this, used car prices are seen to climb up to 20 percent as projected due to the scarcity of new vehicles. Although prices of used cars have gone up, it is way cheaper than the new vehicle. According to the records, 70% of pre-owned cars are sold through auto-loan. Irrespective of the price and interest, there’s always a market for used cars and it remains afloat due to its high demand in the UAE because of the flooding of tourist in the county.