Bloomberg Intelligence Survey Finds That Middle East Buyers Show Limited Interest in BEVs – Favoring ICE Vehicles, German Brands

• BI’s auto-buying intentions survey found that only 10% of respondents in Saudi Arabia and the UAE plan to buy a BEV in the next 12 months, compared to 16% in Europe.
• Internal combustion engine (ICE) vehicles dominate preferences (61%), with hybrids accounting for 29%.
• The survey highlights that BEV ownership in the Middle East is set to grow, from the current 5% per BI’s sample despite a continued preference for ICE vehicles, albeit at a slower pace.
• German brands Mercedes and BMW top consumer wish lists, with Tesla in fourth place, while Ferrari and Porsche lead the luxury segment. Toyota is set to retain market leader status among all buyers.
• Chinese brands hoping to gain a foothold in the market may be hampered by 67% of respondents harboring concerns. While 17% of respondents would be open to owning a local GCC brand, with Saudi’s Ceer Motors set to launch in 2025.

Dubai, 21 November 2024 – Middle East consumers remain cautious about battery-electric vehicles (BEVs), according to a new Bloomberg Intelligence (BI) survey. Only 10% of respondents in Saudi Arabia and the UAE plan to buy a BEV in the next 12 months, down from 19% in 2023, as concerns over charging infrastructure, battery reliability, and long charging times persist.

Despite global momentum for BEVs, internal combustion engine (ICE) vehicles remain the dominant choice in the region, favored by 61% of respondents. Hybrid electric vehicles (HEVs), which combine traditional and electric technologies, account for 29% of preferences.

Mercedes and BMW lead the region’s wish lists ranking first and second, respectively. Toyota follows closely, supported by strong hybrid sales. Tesla, despite limited ownership of BEVs, ranks fourth in consumer preferences, falling from first place last year. Among luxury brands, Ferrari and Porsche top the list, highlighting the region’s growing importance to luxury and premium German automotive segments as demand in China slows with Mercedes topping the list for most wanted brand. Among car owners, around 48% currently own a Japanese brand, led by Toyota with a 32% market share.

Michael Dean, Senior Auto Industry Analyst at Bloomberg Intelligence, said: “The findings on BEVs from the Bloomberg Intelligence survey may be of surprise given COP28 in Dubai last year and various initiatives announced to enhance ownership. Traditional automakers continue to dominate both the luxury and volume segments to the disappointment of new entrants, including Tesla and Chinese brands. Buyers here still have concerns over the availability of charging points, charging times, and battery risks, factors that are unlikely to be resolved over the medium term and pose as a stumbling block for BEV producers. What’s interesting is that respondents are increasingly open to BEVs that are produced by local automakers based in the Middle East, reflecting a trend in recent years where assembly facilities are being built in KSA.”

The survey also highlights scepticism toward Chinese brands, with 67% of respondents expressing concerns about owning a Chinese car due to perceived issues with quality and technology. This could hinder the growth of brands like MG, Changan, and Geely, despite their increasing presence in the region.

Despite the emphasis on sustainability during COP28 UAE, electrification efforts in the Middle East remain slow, underscoring the region’s reliance on premium combustion vehicles. However, local initiatives may spur gradual change. Notably, Saudi Arabia’s Ceer Motors plans to launch its first BEV in 2025, targeting a production capacity of 150,000 units as part of Vision 2030. The survey found that 17% of respondents would consider purchasing a local brand, citing better suitability for the region’s hot climate.

Media Contacts

Oktavia Catsaros, Bloomberg Intelligence

ocatsaros@bloomberg.net

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