Automechanika Middle East kicked off its tenth edition with more than 1300 exhibitors sprawled out over multiple halls in the Dubai International Convention and Exhibition Centre, the number of exhibitors up 24% on last year.
Dubai, with its history as a re-export port, is an appropriate location for the show. Buyers attended from through-out the Middle East, Africa, and as far afield as China and America, many with the hope of securing distribution deals and partners.
Statistics revealed at the show by Dubai Customs showed that Dubai’s total automotive trade rose by 13% in the first quarter of 2012, compared with the previous year.
According to Asad Badami, managing director of A-MAP, which specializes in the distribution of aftermarket automotive parts, Dubai benefits from its ports operation, which can potentially enable the same day release of goods.
“Once a vessel arrives, the container can be offloaded and the goods warehoused within twelve hours. This is something you don’t get anywhere else,” he said.
Nassim Saeed Al Muhairi from the Department of Statistics at Dubai Customs revealed that the total value of Dubai’s automotive trade in Q1, 2012 was worth US$ 2.6 billion (AED 9.6 billion).
“The figures indicate that Dubai continues to figure prominently as the hub driving the growing trade in auto parts and equipment in the wider region.”
“As demand continues to grow, we see increasing opportunities for international companies to benefit from Dubai’s key positional and logistical advantages ,” said Muhairi
A number of growing markets provided many opportunities for exhibitors. North Africa is one area, with Badami saying that it is currently an alluring prospect for UAE-based auto parts traders.
“We met with a number of prospective clientele mainly from Egypt, Libya and Algeria. As these markets start to become more stable and open up regionally, there are big business opportunities available for us,” he said.
Iran, with its current trade difficulties, was also a focus for some exhibitors, with a number of buyers from Iran looking for tyres and service parts that could be picked up from Jebel Ali, with some local traders happy to supply.
“When sales in Iran are down, so are the traders in Dubai,” said one seller.
And with good reason. Figures from Auto Strat’s website show that in the first nine months of 2011, by itself Iran imported more new vehicles (including passenger cars) than the combined total of the GCC countries, Iraq, Syria, Jordan, Lebanon and Egypt.
Australian aftermarket suppliers attended their sixth expo, and with high hopes. Last year 70% of the companies attending received new business, and their presence this year had increased by 30%, slightly above the growth in numbers experienced across the board.
Similarities between the harsh Australian Outback and the off-road conditions in the Middle East also works in their favour, said Ben Bartlett, Senior Manager Government Relations and International with the Australian Automotive Aftermarket Association.
“We are seeing significant growth in the four wheel drive market, in particular when it comes to suspension,” he said.
“There are challenging off road conditions in the Middle East and there are no more challenging conditions than in Australia, so our companies are able to offer road products that fit the marketplace. There is also strong potential growth in the performance and tuning sectors.”
With respect to the number of booths, the Chinese pavilion was the largest contingent by numbers. But it was the German pavilion that impressed, with its large stands and part displays.
Speaking with PMV at the show, Alexander Wagner, vice president sales and marketing aftermarket of the German brake manufacturer Knorr-Bremse, said it was their first time at Automechanika ME, and an important chance to show off their line of brakes and brakes products for the commercial vehicles aftermarket.
“We are here to present our brand to a big audience, and I think it is very important that we participate in this fair.”
Knorr-Bremse, which had turnover of 3.7 billion Euro in 2011, supplies brakes to the commercial vehicle and rail markets. Wagner says that their Middle East revenue is split 50/50 bectween commercial vehicles and rail.
They supply OEM brakes to manufacturers of commercial vehicles, and so their aftermarket business consists of supply to manufacturers for repairs, known as OES, and to the independent aftermarket market.
For Wagner, the show was an important chance to meet with their existing partners of qualified distributors in the Middle East, who include the UAE’s Central Motors & Equipment, a part of the Al Fahim Group. “You need to have a very close relationship with your customers.”
It was also an opportunity to gauge the levels of demand in the Middle East. “We are here to understand in detail the requirements of the market, to speak with people to understand the differences with the European market, and to understand the situation with local distributors.”
Wagner says that the Middle East is a growth region for Knorr-Bremse, with their analysis leading them to believe that there are more than 400,000 Western European commercial vehicles in the wider Middle East, a number comparative with the market in Spain.
Many European fleet owners are also selling vehicles second hand into the region. “Typically they are leaving Western Europe after four years, exactly when we are coming into account from an independent aftermarket point of view, and this area is very important for the future.”
Marc Sommer, regional director for ZF Middle East, said the show was a good chance to promote brand awareness, and connect with their customers especially around technical matters and support.
“For the new components, which are highly technical and advanced, you need to give your partners and customers the reassurance that ZF itself is close to them, because they need the technical information. This is the boost we want to give: We are here, this is ZF itself, you can talk with us directly.”
This was ZF’s second show as a 100% ZF-owned entity ZF. Previously the company had a presence at Automechanika with their local partner, who had participated under his own name. The company has a number of service centres in the Gulf region, including six in the UAE. Additionally it recently invested in a $435,000 (€350,000) test bench in the UAE.
With the increase in vehicle imports, and the newer technology present, Sommer says that the same kind of service that is offered in Europe and North America is also required in the Middle East. As the economy here has picked up there has been a greater awareness of that value that proper servicing can bring.
“In the boom years, no one was really caring about the total lifecycle cost of the vehicles. Now people realise they really need to calculate this, and it is definitely the case that quality pays back.”
While during the boom users would often sell vehicles that they had problems with, Sommer says that attitudes have changed.
“Now they are prepared to do preventative care, which is quite new. No one was talking about preventive care two years ago, and now we have reached the stage that we could customers, ‘If you invest now in your vehicle, it will pay back at the end’.”
By all accounts Automechanika Middle East was a busy time, especially the first two days, with many exhibitors facing a throng of potential customers seeking information.
But as one wholesaler of spare parts explained, judging the results of the exhibition will be harder.
Though the event generated many lead pages, sorting through those to determine those that are appropriate partners can take up to six months, with no certainty yet about how many leads will generate real business.
