A VEHICLE FOR CHANGE

Dubai 2016 | ENERGY & INDUSTRY | INTERVIEW

TBY talks to Michel I. Ayat, CEO of AWR Automotive, on the importance of the firm's partnership with Chinese brands and the outlook for electric cars and the automotive industry in general.

Michel I. Ayat
BIOGRAPHY
Michel I. Ayat is a seasoned automotive industry professional with over 25 years of experience in managing volume and luxury automotive brands from Japan and Europe in the Middle Eastern region. Since the inception of AW Rostamani Group in 2006, Ayat has been instrumental in expanding the business and attaining market leadership positions in key vehicle segments. Ayat holds a Post Graduate Diploma in Political Science and Administration. He is a founding member of the Automobile Sector Committee at the Dubai Chamber of Commerce and Industry.

What is the key to AWR's long-term success?

Our vision for 2020 is to increase our revenues to $5 billion, more than double last year's $2 billion revenues. It is not the first time we have set such growth goals. We did it in 2009 during the global economic crisis; while competitors were undergoing layoffs and cutbacks in operations, we were expanding and we found that this was the right decision. The situation is not as challenging as it was in 2009 when the drop in the market was around 40-42%. We still project a marginal market growth in 2016 or in the worst case it may remain flat, but definitely there is no contraction.

Sales of Chinese vehicles are expected to grow dramatically in the coming years. What effects will Chinese brands have in the UAE market?

We project that China will play a strong role in the automobile market, and this is the reason why we had partnered with SAIC—the largest Chinese automotive group—and have now partnered with Dongfeng Motors (DFM), the second largest Chinese automotive group. In UAE, Chinese vehicles account for 2.5% of the total industry volume, but by 2020 they are expected to have 10% market share and will show a similar trend throughout the GCC as well. Several Chinese automotive companies have already established their base in the UAE and have been increasing their local presence at a rapid pace. In addition, Chinese vehicles have started gaining popularity because of increased focus placed by these companies on accurately understanding the requirements of customers in this region. As a recognized automotive player, we are keen to work closely with our Chinese automotive partners to provide exciting products and services to ensure a long-term, enjoyable driving experience for UAE owners of Chinese vehicles.

What is your outlook for electric cars in the UAE?

The traditional systems and processes used in cars cannot further guarantee an increase in market share. This is the reason why we see more disruptive technologies being integrated into automobiles, transforming them into hybrid or fully electric vehicles. The UAE is the only country in the region that already has electric cars, an initiative that has been pioneered by Arabian Automobiles jointly with Renault. In April 2015, we held the first ever Electric Vehicle Conference in UAE, where I discussed electric vehicles and their impact. The UAE will celebrate its 50th year of the union in 2021, and we aspire to have approximately 10,000 electric vehicles in Dubai by then. Furthermore, the Emirates Authority for Standardization & Methodology (ESMA) officially recognized electric vehicles at the end of 2015. We are on the fast track, and as the regulations are coming, insurance companies will begin to recognize electric vehicles and all the distributors will be ready to offer their respective products and services. While Dubai aspires to be the smartest city in the world, it is equally important to build a greener city to support future generations. Electric vehicles are a vital component in this strategy and will support Dubai's vision to be the smartest city by promoting sustainable transportation. Replacing one traditional gasoline vehicle with an electric vehicle is equivalent to planting 100 trees.

In fact, replacing 10,000 gasoline cars with electric vehicles could transform Dubai to become as green as a forest of a million trees by 2021.How do you expect the automotive industry to evolve in 2016?

Based on today's market conditions, we still project marginal market growth in 2016 or in the worst case it may remain flat. Every distributor today wants to maintain their market share amidst these tough market conditions. However, AWR Automotive is fully focused on growing its market share by adopting the right strategies. We are on the right track, the direction is clear, and this is why we are considered by our principals as the regional leader in selling Nissan, Infiniti, and Renault automobiles.