As per a demographic survey conducted by the General Authority of Statistics, many Saudi Arabian families own at least two cars. 92% have at least one car, and 56% have more than one car. In cities like Riyadh, the residents use their car for a range of activities, including daily commute to schools, offices and shopping considering the lack of public transport — and of course, inexpensive availability of fuel.
In particular, long-distance travelling and desert safari are preferred weekend getaways for them. It is rare to see parents carpooling too. Hence, there is a significant demand for used cars.
Even with expats & immigrants, there is a huge demand for used cars because most individuals want to cut down and costs. And considering the good conditions of the cars here, it’s very convenient to buy used cars.
source- http://glasgowconsultinggroup.com/market-opportunities-for-used-cars-in-saudi-arabia-2020/
nue As per research in 2019, the used car market in KSA is US$ 16.8 billion in revenue (0.9 million units), based on a 9-year car parc. And the used car market is expected to grow at a CAGR of 6.3% in the next 6 years to reach US$ 24.3 billion in 2025.
The market in Riyadh is driven by multiple factors such as:
> The younger generation of Saudi’s entering the workforce
> Lifting the ban on women drivers
> The fall in disposable income
> Middle-income expatriates looking for better bargains
What do market trends predict?
One out of every five cars of the car parc (15 years) was transacted in the Used Car Market in 2019. On the contrary, 1 new car sold 2.5 used cars (under 15 years) are sold each year. And this ratio is expected to grow.
Why used cars are budget-friendly?
1. Almost new conditions
Unlike other countries, the average time for car replacement is about 2 to 4 years. And expatriates change the cars after 4 years on an average. This means that the used cars in almost good or new conditions. This implies lower maintenance costs, reduction in initial payment and many similar benefits.
#Tip: In general Toyota and Japanese vehicle brands are sold after 4 to 6 years of ownership compared to American and European Models which are sold after 2 to 4 years.
2. Option to upgrade for low costs
Another benefit of buying used cars in Riyadh is that you get a higher budget car or a better model for the same price. For example, if you are looking for a sedan, you can get an upgrade to a Toyota Corolla instead of a Ford Figo — which offers a better car segment.
3. Convenience for expats
Most expats prefer buying used cars because they don’t want to spend much. Apart from the benefit of cost difference, you can get a model in great condition and give some good years. Plus, expats are on a temporary visa and investing in a brand new car doesn’t really make sense.
4. Easy accessibility
Budget-friendly used cars are readily available on plenty of online platforms. Many of them offer verification processes for a standard fee, like zeaara.com. This process ensures that experts check a used vehicle, and you pay a fair price for it. Most rental/ leasing companies change their fleets between 18 months to 30 months on average.
Factors that impact used car markets in Riyadh
There has been a production cut in importing countries that would increase the pricing pressure for dealer and distributors because of a rise in CAPEX price from OEMs.
In Saudi Arabia, 50 % of the population is below the age of 30 and below — and many are immigrants, which means limited spending power. As a result, there is a huge demand for the used car market.
While there was a big setback to the used car market because of COVID and restrictions on immigrants and expats, the market has picked up.
The demand for used cars is likely to remain strong and grow in Riyadh and KSA. With an increase in VAT increase, the market prospects for used vehicles is also expected to grow further.
If you are looking for a used car, we have quite a few available at: https://www.zeaara.com/classifieds/cars.html
You can also try our ’Verify Before Purchase’ service. For a fee of SAR 150, we will verify the condition of the car for you. https://www.zeaara.com/verifybeforeyoubuy.html/