Gearing Down
By Alex Malouf • Mar 4th, 2009Drivers wanted.
There may be a silver lining for companies in the Kingdom’s auto sector. Ever since the accession of King Abdullah, the debate about women being allowed to drive has grown, even among Royals. During one event in Switzerland several years ago, Princess Lulwah al-Faisal said she supports women driving; comments that stirred up a storm in Saudi. But for the auto sector, if women, who make up more than half the country’s population of 26 million, are allowed to drive, then there would be a surge in car purchases.
“The issue of women driving is a foregone conclusion and nobody can stand against the current. The right time for it has not come, unfortunately. But it is better that it takes so long, than for it to never happen,” says Ibrahim al-Jomaih, owner of al GMC’s largest domestic dealership. “I believe there is nothing against driving, there is nobody [who] can prove that it is against the religion, or against culture or tradition. But it is just the matter of the right time and climate for it. Those who don’t want their women to drive, then don’t buy them cars! I’d rather have my wife or daughter or sister driving than have a stranger driving her.”
Ali-reza is positive about one aspect of the present economic downturn. The man who led the automotive industry in Saudi Arabia for decades believes that dealers will have to improve their service offerings if they are to keep customers coming back over the long term. “There are a lot of competitors in the market, but what will distinguish my company from theirs is good support. I can convince anyone to buy a car once, but their decision to keep coming back to us will be made in the support center. Saudi is a big market but you cannot survive for a 100 years without repeat selling.”
One of the most important markets for the big three US car makers, Saudi Arabia’s automobile dealers have had to come to terms with public sentiment, which has affected Toyota more than any other brand. While car dealers believe that it will be business as usual at the end of 2009, there is an admission that these are unprecedented times for the country’s automotive sector. As Ali-reza explains, dealers have reduced their orders for the first half of 2009 and are hoping that the 2010 models will usher in better times. But with the fate of the Kingdom’s car industry resting on events in Europe, Japan and the US, their fate may not lie in their own hands.
