Oman Autos Report Q4 2015
BMI has become increasingly negative on the outlook for Omani new vehicle sales over the past quarter.
Indeed, we now feel that the indicators that are positive to Oman's economic growth prospects, such as agrowing population and increasing urbanisation, are actually putting a burden on its roads. Moreover, wefeel that new measures to curb congestion mean that the poorest consumers will be priced out of the carmarket. As such, we now expect total vehicle registrations (all first time registrations of both new andsecond-hand vehicles) to fall by 24.3% in 2015, led by a 30% drop in passenger car registrations, as peoplefind it increasingly difficult to afford car purchases.
From May 1, imports of used vehicles more than seven years old have been banned and, while Omaninationals can import any number of vehicles meeting these requirements, non-nationals are restricted to justone. This echoes earlier attempts elsewhere in the Gulf Co-operation Council (GCC) states to limitcongestion by targeting the non-national community, such as Qatar proposing a limit on the number ofdriving licences that can be issued to ex-pats. Moreover, in a bid to regulate the second-hand import market,the Royal Oman Police (ROP) has also introduced a directory of prices for cars produced between 2000 and2010, which will stop the practice of estimating a car's value in order to calculate the import tariff. This islargely expected to increase prices as the rate had previously been at the ROP official's discretion. Overall,BMI believes that this new import tariff - which will price many consumers out of the market - will have adevastating impact on what had until now been a thriving second-hand import market.
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