Saudi Arabia car sales surge 6.9 pct in first half of 2020 amid coronavirus

General view shows the cars on the street, after curfew lifted, which was imposed to prevent the spread of the coronavirus disease (COVID-19), in Riyadh, Saudi Arabia, March 24, 2020. (Reuters)

Car sales in Saudi Arabia increased by 6.9 percent in the first half of 2020, compared to the same period in 2019, despite the COVID-19 global pandemic, according to automotive data analysis website Focus2Move.

From around 232,000 sales in the first half of 2019 – marked as a big year for the automotive industry in Saudi Arabia due to a royal decree allowing women to drive – the car sales in the first half of 2020 increased to 247,799.

On May 11, the Saudi General Authority of Zakat and Tax announced increasing the value added tax (VAT) from 5 percent to 15 percent on all products and services starting June 1.

The decision was among the measures taken by the Saudi government to preserve the Kingdom’s economy and help it overcome the coronavirus pandemic and its financial and economic effects, according to the Saudi Press Agency (SPA).

According to Focus2Move, the coronavirus pandemic slowed down the automotive industry when the car market was flat at -0.2 percent in March due to lockdowns and business closures.

However, the Kingdom’s reopening around April and a purchase rush in May driven by the VAT increase announcement saw a market recovery to levels higher than the previous year.

In a regional ranking done by the automotive data analysis website, Focus2Move reported that the only two countries in the Middle East and North Africa region that saw a car sale increase in the first half of 2020 were Saudi Arabia and Egypt.

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Last Update: Friday, 11 September 2020 KSA 12:33 - GMT 09:33
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