0 Listings
Light vehicles, cars, trucks, buses, and motorhomes are all sold at dealerships and retail stores in the Arabic automotive sector, along with producers and wholesalers of automobile equipment. A small number of powerful automakers, including Ford, General Motors, and Chrysler, dominate the market and set its pace. Manufacturers of steel, aluminum, and other raw materials as well as original equipment manufacturers, who create and construct particular components for bigger automakers including engines, batteries, and electronic parts, are important suppliers to this sector.
The majority of large manufacturers have a business-to-business (B2B) model, and their usual clients are wholesale retailers, rental firms, and dealerships, all of whom have B2C models. Currently in its mature stage, the industry is distinguished by increased M&A activity and consolidation. Manufacturers in the minimally regulated Arabic auto industry are required to adhere to safety regulations. Trade laws are important because the sector is very worldwide. Consumer discretionary income is the main factor driving the business and creating demand for automobiles.
The industry thrives in a low-interest rate and low commodity price environment which allows higher profit margins for manufacturers and retailers as well as cheaper financing for retailers. A weaker currency also generates tailwinds by arabian goods more competitive. In the recent decade, auto manufacturers have moved operations overseas, to Asian and South American countries, due to an abundance of cheap labour and non-unionized.
Consumers' decisions to buy cars can be influenced by their macroeconomic background. People are more inclined to buy new cars when the economy is doing well, which boosts the sector. Vehicle usage declines as a result of a slowdown in economic activity, which also lowers corporate and consumer confidence.
Nowadays, vehicle consumers want more features in their automobiles, such as environmental friendliness, safety, and user-friendly design.
Automotive businesses attempt to obtain a competitive advantage by leveraging sophisticated technologies to meet consumer quality and cost needs. Furthermore, technology enables them to meet the requirements of environmental regulations.
Automotive firms are frequently vulnerable to consolidation and M&A activity. Over the last two decades, improved internet connectivity has resulted in increased visibility and a surge in business services that enable IoT technology. The epidemic has expedited the shift to internet commerce, serving as a driver for the industry, as Saudi leading private market M&A advisory firm BB Capital recognizes that selling a business is a significant decision. A dedicated business owner aims not just to maximize value from the sale of a business, but also to sell the business to a competent buyer who can carry on the company’s heritage.
BB Capital has completed over 100 valuation and M&A consulting mandates in the business services market, bringing substantial experience in transaction negotiation to the table. Our professional advisory team will help your company navigate the whole sell-side M&A process.
Understanding some crucial elements unique to the business services sector that could affect the possibility of a possible sale is crucial for entrepreneurs and business owners considering a possible sale. These elements influence how appealing a company is to possible investors and buyers.
Sales: A car company’s value can be determined by its strong sales. They stand for superior products, creative designs, and a solid brand reputation. Large companies in the sector usually have high sales and can keep up with the rapid advancements in technology.
Supply chains that are mature To deliver a single product to consumers, an automotive business depends on numerous other industry participants. A strong supply chain guarantees cheap costs and efficient production, which raises margins.
Together, the BB Capital transaction team has 40 years of expertise working with firms both domestically and internationally, including for a number of automotive companies across several industries. Whether it’s a sale or a valuation, our team can offer resources and experience that are only available at larger companies, together with the individualized attention of our M&A Advisory team. Reach out to one of our advisors by contacting us right now.
Our Process
Khalid.Alsuhaim@bluebeachcapital.com
+966 50 580 5050
