In conversation with, Senior General Manager at a Leading Online Marketplace in UAE, we sought to gain insights into the UAE Used Car Market. We explored its key players, procurement process, transaction splits between B2B and B2C, and the market composition in terms of organized and unorganized segments. Additionally, we learned about the prevalence of local dealers, their export activities, and the sale of accidental cars in the market.
“UAE Used Car Market is a dynamic and diversified industry with a significant presence of OEMs, Multi-Brand dealers, and Online Marketplaces, catering to both individual consumers and corporate buyers”.
Q1. How big is the UAE Used Car Market, and what is the share of exports in it?
The UAE Used Car market accounts for approximately 300,000 units sold or volume, excluding exports. When exports and re-selling are taken into account, the total market size reaches 600,000 units, equivalent to 50,000 sales per month.
Q2. Can you please elaborate on the procurement process of OEMs in the UAE Used Car Market?
OEM dealerships in the UAE offer a trade-in option, allowing sellers to exchange their old cars for new ones by paying the price difference. While majorly individual customers sell and buy cars, most OEMs do not purchase vehicles from rental and leasing companies. They mainly buy from corporates and also sell to them, although this proportion is relatively small.
Q3. Who are the major players in the UAE Used Car Market?
There are approximately 30-35 OEM players in the UAE Used Car Market, with Al-Futtaim being the largest player. In addition, there are 10-20 multi-brand players, with Automall as the largest player, followed by NXT.
Q4. Can you please elaborate on the procurement process of Online Marketplaces in the UAE Used Car Market?
Online marketplaces in the UAE follow two primary models. In the first model, individuals, local dealers, and Multi -Brand dealers list their cars on the platform, and buyers can directly purchase from the seller. In the second model, online platforms acquire vehicles from various sources, including individuals, auction houses, rental car companies, dealerships, and importers (though imports constitute a minor portion, less than 10%). These platforms then sell directly to end users.
Q5. Who are the major Online Marketplace Players in the UAE Used Car Market?
There are five major online marketplace players in the UAE Used Car Market. The largest is Cars24, followed by Kavaak, Carnab, and Carswitch. In the classifieds category, Dubizzle is a major player.
Q6. What is the general split of B2B (Business-to-Business) vs. B2C (Business-to-Consumer) transactions on Online Marketplaces in the UAE, and what about the procurement split of Online Platforms?
The split of B2B vs. B2C transactions on online marketplaces in the UAE is approximately 20:80, although this ratio can vary from one platform to another. Around 70% of vehicles are procured from individual customers, while the remaining 30% come from corporate sources.
Q7. In the organized market, what is the split of OEM, Multi-Brands, and Online Marketplaces in the UAE Used Car Market?
In the organized market of the UAE Used Car Market, OEMs represent roughly 30% of market share, Multi -Brand dealers hold about 40%, and online marketplaces account for the remaining 30%, excluding classifieds.
Q8. In the unorganized market, what is the split between Local Dealers, Auction Houses, and Word of Mouth Sales in the UAE Used Car Market?
In the unorganized segment of the UAE Used Car Market, Word of mouth sales constitute a limited share, approximately 5%, while local dealers occupy around 60% of the market. The rest of the market is attributed to Auction Houses.
Q9. How many local dealers are there in the UAE Used Car Market?
A9. In Dubai alone, there are approximately 400-500 local dealers, while Sharjah and Abu Dhabi each have around 120-150 local dealers and ~150 in rest of the regions.
Q10. Do these local dealers in the UAE Used Car Market also export and sell accidental cars?
A10. Yes, some of these local dealers engage in both domestic sales and exports. However, the sale of accidental cars from these dealers is relatively low, accounting for less than 7-8% of their overall business.
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