Boston, MA -- (ReleaseWire) -- 02/27/2014 -- This quarter, BMI has extended its forecast period out to 2018. Over the newly extended forecast period, we continue to target strong growth in new vehicle sales, which should increase by some 40%, to around 140,000 units in 2018. Our positive outlook continues to be based on rising government expenditure, a growing population and increased spending on construction ahead of Qatar's hosting of the 2022 FIFA Football World Cup.
Looking forward, BMI retains an optimistic outlook on the Qatari new vehicle sales market over the medium term; although we would caution that the pace of growth may well slow towards the end of our forecast period.
There remain several reasons behind our continued optimism towards the Qatari new vehicle sales market. For 2014, BMI's Country Risk team is targeting GDP growth of 5.4%, with economic activity continuing to be driven by growth in the non-oil sector. Indeed, looking at the most recent economic data from the Qatar Statistics Authority, the non-hydrocarbon economy grew by 9.9% year on year (y-o-y) in real terms in Q213, compared to 6% for the economy as a whole. We believe that robust private consumption on the back of a fast-rising population, large government spending commitments, and continued progress on infrastructure projects by public enterprises will support growth over the coming quarters.
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Adding further support to our bullish stance towards Qatari new vehicle sales is the fact that we expect private consumption - a key indicator of likely consumer demand for new vehicles - to continue to grow at a rapid pace throughout 2014, supported by the government's expansionary fiscal stance and a fast-rising resident population. Indeed, BMI's Country Risk team recently raised our private consumption growth forecasts to 11.0% in 2014, from 8.0% previously.
Looking at sales figures for 9M13, it is clear that demand for luxury cars remains strong within Qatar. Rolls-Royce Motor Cars Doha reported sales growth of 18% over the period, with the Phantom model seeing growth of 83% across its model range, according to a report in Qatar Today. The Ghost Extended Wheelbase model also saw growth of 75%. Alfardan Automobiles, the importer of BMW and MINI cars in Qatar, reported a 25% y-o-y rise in sales in 9M13. The company posted 25% y-o-y and 19% y-o-y sales growth for BMW and MINI cars respectively during the period, and expects another record year for sales. Alfardan posted a 78% y-o-y increase in sales of the BMW 1 Series, while sales of the BMW X3 grew 65% y-o-y in 9M13, compared with the same period of the previous year.
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