Auto trends lost in translation

Image via ryantxr on Flickr

As usual, statistics are blinding and baffling everyone. And one of the big banjaxers is this report from the Dubai Chamber of Commerce and Industry (DCCI), which says that the emirate’s auto industry is in good shape now and will increase by eight per cent annually over the next four years.

There’s no doubt that this percentage is about right, or even a little on the conservative side (although the claims in the linked Arabian Business story that luxury cars will feel the pinch are certainly questionable). What is in doubt is the way this statistic has been translated on the whole.

For example, the ever-jubilant pages of Emirates 24/7 hailed how the “automotive sector plays a vital role in promoting the UAE’s competitiveness” and attributed this impending success to ”the development of world-class public transport infrastructure”.

This is rather surprising. One would expect that a “world-class public transport infrastructure” would mostly keep people away from dealership forecourts as they sampled the gentile genteel (embarrassing spelling edit) joys of a Gold Class carriage of the Metro.

Even the usually on-the-button Kipp Report has been hoodwinked into heralding a brave new era of car ownership by looking at this growth out of context. It quoted John Stadwick, president and managing director of GM Middle East as saying, “February represents another month of double-digit sales growth. Outstanding sales driven by Chevrolet cars – the Aveo, Cruze and Malibu prove that our award-winning line up of vehicles is growing in preference among customers in the region.”

Year on year is the key here, with growth based on what? A year ago, the Dubai auto trade was still reeling from the previous year’s collapse and consumers were still clamouring for credit with little success. Also, expats were leaving at a faster rate than they were arriving, which meant that those who could secure credit would have been better advised going to used-car lots and auctions to pick up a bargain. The industry was going through a very tough time.

This year, things are much improved: it looks like more expats are arriving, hungry for new cars, and they have better access to credit. A figure of 21 per cent looks more realistic than it is triumphal.

Kipp also looked at AW Rostamani’s recent launch of MG as another cause for celebration. Let’s not forget that the marque has been enjoying great success in China for a couple of years now under its parent, SAIC, the biggest player in that country’s automotive industry. With prices significantly less than their respective segments’ averages, the two new MG cars are ripe for the picking in these still-tough-but-getting-better times.

None of this reflects badly on the automotive industry, and those brands that are seeing success this year deserve every sale they make. Quite rightly, manufacturers and dealerships have press releases to issue and are keen to demonstrate their brands’ successes, so they will enthusiastically use every positive figure they can lay their hands on.

It is, however, up to the media to be a little more judicious in its reporting of industry trends. Things are looking up, but it is still too soon to usher in a new boom for automotive.