A growing market in Iraq has helped GM's sales rise as Chevrolets, Cadillacs and GMC vehicles sell well in the Middle East.
GM sales accelerate on easier lending
Easier access to car finance helped General Motors (GM) Middle East sales to surge by more than a quarter in the last three months of last year.
GM sold 38,450 Chevrolet, Cadillac and GMC vehicles across the region over the quarter, up 26 per cent compared with the same period in 2009.
A general economic recovery and relaxed lending criteria for would-be car buyers in the UAE helped to drive sales, a GM spokesman said. "We've started to see banks loosen up on approvals, and opened [lending] up to more nationalities and occupations," he added.
The car maker sold 123,258 vehicles in the Middle East last year, up 5.5 per cent from 2009, following gains in Iraq and Saudi Arabia, GM said yesterday.
After signs of the economic downturn began to appear in the UAE in 2008, nervous banks tightened their lending criteria. This included raising minimum salary requirements, asking for larger down payments and rejecting candidates who worked in certain industries, such as property.
Car financing approval rates are not back up to levels of 2007 and early 2008 but began to improve last year, particularly in the fourth quarter, the spokesman said.
"Abu Dhabi hasn't been as affected as Dubai. Dubai is where the [loan] rejection rates were high … It's not back up where it used to be, but it has improved."
BMW Middle East, whose sales rose 18 per cent across the region last year compared with 2009, also said access to financing had improved.
GM said its fastest growing market last year was Iraq and cited increased political stability in the country as a factor.
Sales in Iraq rose 52 per cent, compared with 2009. But in the fourth-quarter, GM's sales in Iraq rose by 112 per cent compared with the same quarter the previous year.
"It's mainly the stability … in 2007 we started seeing the country becoming more and more stable, and sales have been picking up," said the GM spokesman. "There is a correlation between the two."
Saudi Arabia continued to be GM's biggest regional market, by sales, due in part to its relatively large population. Sales rose 7 per cent last year compared with 2009, and 28 per cent in the fourth quarter last year from the same quarter a year earlier.
Sales in Kuwait and the UAE, the other two large markets for GM in the Middle East, remained relatively flat last year compared with 2009, the spokesman said.
Cadillac was GM's fastest growing brand in the Middle East, with sales up 26 per cent compared with 2009. Chevrolet sales were up 9.2 per cent year on year, due in part to new models including the Cruze and Malibu. GMC remained flat over the year.