Trade

Exeed joins Chinese push to corner UAE EV market

August 24, 2023

UAE distributor AG Auto says Exeed is in 'pole position' to cement its place in the market

Exeed targets high-end SUV market
32% increase in EV sales predicted
UAE on cusp of ‘transformation’

Another brand name is about to join the growing list of Chinese electric vehicles available in the UAE, with premium sports utility vehicle Exeed ready to enter the market in the next two years.

AG Auto, an automobile subsidiary of Dubai-based family conglomerate Al Ghurair Investment, is the exclusive distributor for Exeed in the UAE.

Mohammed Maktari, executive vice-president at AG Auto, told AGBI the plan was to introduce a plug-in hybrid model next year and then “EVs will be the year after”.

While traditional EV brands like Tesla, BMW, Mercedes, Volvo and Chevrolet remain popular, more affordable Chinese EV brands such as BYD, Feely, Hongqi, Neo and Xpeng are expected to gain market share over the short term.

Data from China’s General Administration of Customs revealed that China exported over three million vehicles in 2022, with a year-on-year growth rate of 57 percent. EV exports accounted for more than one in four of total exports.

EVs currently make up just over 1 percent of the total UAE car market, according to the CARS24 Used Car Market Insights H1 2023 Report.

A 32 percent increase in sales of passenger EVs in the UAE is forecast for this year as the government launches a national policy to support the sector’s growth.

Sales are expected to reach almost 22,000, up from an estimated 16,442 in 2022.

Longer-term calculations suggest the total number of EVs will exceed 370,000 by 2032, representing 11 percent of the UAE’s passenger vehicles.

Analysts at BMI estimated that the UAE’s EV charging network reached around 500 points in 2022 but plans have been announced to significantly increase that number.

Redseer Strategy Consultants said in a new research note that the region is on the cusp of a “significant transformation” in its automotive landscape.

“With the right policy and infrastructural support, the market is projected to grow its EV penetration five-fold by 2027,” its analysts said, adding that the percentage of EVs could rise from 2 percent in 2022 to 12 percent in just five years.

Redseer said car buyers in the UAE tend to own multiple vehicles, with EVs as their secondary cars.

The market has experienced a bigger rise in the adoption of high-end EVs compared with Saudi Arabia and Turkey, where affordability is more of a factor.

AG Auto executive vice-president Mohammed Maktari

AG Auto this week opened its new Exeed sales and service centre on Dubai’s Al Ittihad Road, where three internal combustion engine SUV models will be sold, the Supercharged AWD, Premium Intelligent+ and Premium 7-seater.

Among its technological features is voice command in Arabic. “It’s very heavy on technology, with very high-end finishes. I think the Arab consumer loves technology,” Maktari said.

Chinese automakers have been able to capitalise on the shortage of chips and other core components among legacy western original equipment manufacturers’ lengthy supply chains.

In contrast, many Chinese automakers have access to a complete industrial chain, which helped rapidly increase capacity while western automakers had to cut production and in many cases hike prices.

Coupled with the ongoing cost-of-living crisis and the Russian war in Ukraine, Maktari said China is in pole position to cement its place in the market.

“These high prices have opened up opportunities for other countries like China where their production costs are lower, more reasonable and this is probably the right balance for the consumer,” he said.

Exeed launched in Saudi Arabia last year and is also available in Qatar and Kuwait, with a distributor deal under negotiation in Bahrain.

Maktari said the plan was to open a showroom in Abu Dhabi this year before exploring opportunities across the Northern Emirates in 2024.