Vehicle buyers in the UAE are now much more cautious towards splashing out on a new vehicles; taking far longer to make a purchase, according to YallaMotor.
The company recently released the findings of a report that delved into buyer concerns as the Coronavirus (COVID-19) continues to disrupt life in the UAE. Its general manager Jorge Bialade, says that the insights come from the answers of more than 1,200 car buyers across the GCC.
He says that their responses to the online retailer’s survey is helping YallaMotor to understand their perspectives towards purchasing a vehicle.
“YallaMotor is always at the forefront of understanding car buyers’ behaviours,” he notes.
“The current COVID-19 situation hit all of us by surprise and now, our number one priority is the health and safety of our employees and all the members of our community. We are in debt to the heroic efforts of first responders, doctors, nurses, researchers, public health experts and public servants globally and locally who lead with example. Their determination is an inspiration and as an organisation, we have taken the necessary measures to adapt to the ‘new normal’.”
According to Bialade, uncertainty is a word automotive industry has been hearing (possibly too much) lately. He argues that the report helps bring clarity to how the pandemic is reshaping the market.
“We decided to shed some light on where car buyers stand, what they are expecting and how their purchasing cycle has changed.”
He adds: “Another statement we heard a lot was: let us wait until things get back to normal. Whatever we used to experience as the “norm” won’t be there anymore. The fact we might be able to go back to our offices, take a walk, participate in events, drive cars and walk into showrooms does not mean our purchasing behaviors won’t change. COVID-19 forced us to rethink the way we operate while slowly and almost without noticing it changed our behaviours.
“Although we are unsure how long this uncertainty will last, we hope that these initial results will help guide the automotive sector towards their next plan of action.”
A subsidiary of the Middle East’s leading job site Bayt.com, YallaMotor was launched in 2012 and has grown to become the most visited automotive portal in the region.
With the aim of simplifying vehicle research, buying, and selling, it serves over 27,000,000 sessions, more than 138,000,000 page views and more than 13,000,000 car buyers that spend more than 75,000,000 minutes browsing car content that generates more than 1,100,000 leads a year.
Its general manager Bialade said YallaMotor’s survey could start throwing some light in regards to what will be the real definition of ‘going back to normality
“Currently, during a time of uncertainty and transition towards new ways of doing things, we are not afraid to say we do not have the answer.”
Topping the list of questions is a probe into how the COVID-19 situation has affected their car purchasing.
As expected, the majority of car buyers who were in the market to purchase a vehicle have decided to hold their decision until there is more clarity on how the situation will be in the near future: 64.5% mentioned, due to COVID-19, their decision to purchase a vehicle has been affected.
From a qualitative point of view, this means car buyers will no longer be in the market for changing their car, or else, they are now thinking of more budget-friendly options.
With convenience in mind, consumers will be interested in looking into more affordable options and also looking into second-hand vehicles if they were interested in purchasing a new one. More resilient car buyers, a specific group of 35%, have mentioned the current situation has not affected their decision to purchase a vehicle.
Unsurprisingly, buyers in the market are now much more cautious towards splashing out on a new vehicles; taking far longer to make a purchase.
When it comes to the time frame, compared to YallaMotor’s results from the Car Buying Behaviour report it released last year, 64.59% of car buyers stated they make the decision in less than a month. Now, we can see the majority of car buyers will take up to 3 months (39.19%) to make their decision while 40.35% within 3 to 6 months.
Buyers were also asked this year whether they plan to purchase a new car or prefer to opt for certified pre-owned or used vehicle.
YallaMotor also wanted to better understand this preference in regards to a new or used vehicle and the data clearly shows a massive appetite for purchasing a used car. Rounding up the numbers, almost seven out of 10 have the intention of buying a second-hand car, two out of 10 a new car and one out of 10 will consider a Certified Pre Owned vehicle.
While it is a known fact that car buyers are relatively price-sensitive, the COVID-19 situation has made that far more evident.
YallaMotor has found that 74% of the buyers that answered the survey said that reducing prices will positively impact their decision to purchase a vehicle. 11% would prefer to see attractive loan options. 10% would prefer complementary financial assistance throughout the ownership cycle, such as insurance and servicing. The remaining 5% will consider options with less commitment and monthly payments such as lease and co-ownership. This is certainly something new we have not seen before.
Some manufacturers and dealers in the UAE, such as Peugeot, are now offering interested buyers the opportunity to test drive cars at home without the need to visit the local showroom. These initiatives appear to in line with YallaMotor’s own findings.
While previously 50% of car buyers were willing to visit the showroom at least twice before purchasing a vehicle, things have changed. Now, 56% of car buyers are not willing to go to the showroom to check the vehicle.
This brings a massive potential to online tools and alternative ways to engage with customers. For instance, only 18% mentioned they are not willing to test drive a car at home.
The remaining 82% are open to doing so as long as vehicles have been sanitised, they have a sales consultant with them, and they can book it online.
This also triggered another opportunity such as an online purchase. At this point in time, 6 out of 10 car buyers will consider purchasing a car online.
Deeper information that might be available online through third-party websites plus a concierge service to the customers in order for them to test the vehicle will be essential for the users to purchase the vehicle online.
