"Saudi Arabia Autos Report Q1 2015" now available at Fast Market Research

Saudi Arabia has seen continued strong growth in new vehicle sales over 2014 year-to-date. 8M14 sales figures stand at 544,810 units. Given this positive backdrop, BMI has slightly revised upwards its 2014 sales forecast, from 5.4% to 5.9% annual growth.

Despite the recent sharp decline in international oil prices, we believe that the country's macroeconomic backdrop remains broadly favourable, with BMI's Country Risk team forecasting real GDP growth of 3.6% in 2015 on the back of an increasingly positive outlook for construction activity. Indeed, we see Saudi Arabia's economic performance remaining strong heading into 2015, on the back of high levels of private consumption (which will support demand for passenger vehicles) and fixed investment (which should boost demand for commercial vehicles).

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Turning to private consumption - a key indicator of likely demand for new vehicles - BMI retains a bullish view this quarter, forecasting growth of 5% in 2015. Retail sales are set to benefit over the year from structural factors, including rising disposable incomes, favourable demographics, and increasing urbanisation. Annual growth in the value of point-of-sale transactions, a proxy for retail sales, has strengthened over 2014, rising to a 29-month high of 28.3% in August.

Strong levels of private consumption should therefore lend support to demand for new cars. Auto financing should also remain fairly affordable, with monetary policy conditions set to remain supportive. BMI believes that Saudi consumer price inflation (CPI) will stay at a moderate annual average of 3.4% in 2015, in large part thanks to the strength of the US dollar. As such, we expect no change to the Saudi Arabian Monetary Agency's key policy rates over the coming quarters, with the repo and reverse repo set to stay at their current levels of 2.0% and 0.25% respectively. This will help any Saudi residents who require financing in order to purchase a new vehicle.

Overall, we believe that confidence...

The Saudi Arabia Autos Report features the latest data and forecasts covering production, sales, imports and exports.

Business Monitor International (BMI)'s Saudi Arabia Autos Report provides industry professionals and strategists, corporate analysts, auto associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on the automotives market in Saudi Arabia.

Key Benefits

* Benchmark BMI's independent automotives industry forecasts on Saudi Arabia to test other views - a key input for successful budgetary and planning in the Saudi automotives market.
* Target business opportunities and risks in the Saudi automotives sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Saudi Arabia.

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