Activity in Dubai’s Auto Market

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Dubai’s car market is now on the right track, if judged by the results of the Dubai Auto Show that concluded here recently. A number of manufacturers chose to unveil their models at the show which was well attended, and got a lot of attention from both wealthy buyers and car enthusiasts.

This is seen in stark contrast to the time when expatriates leaving Dubai chose to abandon their cars at the city’s airport with keys and apology notes in them. Dubai was affected by the global recession which hit the Gulf region in late 2008, decimating the emirate’s real estate and construction sectors and sending thousands of expatriates and migrant workers back home at short notice.

Some were even informed that they were being let go while on vacation back home. Many people have bad recollections about the experience and will probably not return to Dubai anytime soon.

But back at home, it is the lack of jobs and underpaid employment that forces them to take the risk. The Government does not pay any attention to this problem, and as a consequence people are forced to work for low wages in appalling conditions just to make ends meet. The effect of the recession in Europe, USA and other developed nations also means that there are less wages and employment to go around, as a result of which the expatriate is enticed to take up job offers millions of miles from home.

Dubai authorities had understandably played down the problem of abandoned vehicles in the city. Nevertheless there were many abandoned vehicles found at the airport and in parking lots, covered in dust with messages such as “Gone Away” or “Sorry” written on the windscreen. These cars were either returned to the borrowing firms who had taken the loans, repossessed by the banks that had sanctioned the loans or if fully paid up, auctioned off by the Government in the second hand auto market.

Despite all this, even today expatriates make up more than 80 percent of the UAE’s population. The country’s economy, which contracted by 0.7 percent in 2009, is expected to grow as little as zero to 1 percent this year, according to the estimates of the International Monetary Fund experts.

Because of these reasons, following the downturn in the property sector and the credit crunch that is crippling economic activity, these economists have forecast a UAE population growth of less than 1 percent this year. The Government will have to do something to stimulate the economy and cannot rely strictly on market forces. Even the USA and Europe had been forced to offer stimulus packages to revive the key sectors of their economy.

Most likely the UAE Government would have to change employment policies giving employees more rights and protection and improve working conditions and labor laws. They might also have to relax visa restrictions and lengthen the duration of stays so that the migrant workers are enticed to return to the emirate. Car and auto dealers in Dubai are having a field day as some of the best models have been available through Government auctions.

The market is ripe with opportunity, with some even having being picked up by used cars Abu Dhabi. car dealers Dubai have been doing good business and even offering cars for sale through the classifieds Abu Dhabi or classifieds sites Dubai section of the newspapers.

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