UAE steps in to control EV imports at used dealers – stop all such VW shipments

Dubai: Want to import electric cars into the UAE? Then make sure the Volkswagen EV model isn’t on your list.

The UAE Ministry of Finance has just issued a directive that no new/used Volkswagen-made EVs can be imported into the country except through authorized dealers.

The decision follows repeated concerns at the highest levels that such imported electric vehicles are often built to European specifications, rather than being tuned to the UAE’s vastly different climatic conditions.

“Some second-hand dealers are cashing in on the high demand for popular EV models from UAE buyers,” said a senior source at a luxury car dealership in Dubai. A welcome choice. But these models are being sold without a manufacturer’s warranty – buyers here are taking a significant risk when purchasing these ‘Made for EU’ vehicles.”

Potential EV buyers in the UAE have looked outside to source their models, some of which have yet to be officially launched for the Gulf market. Most traditional automakers are still in the initial stages of ramping up EV production — and it will still take time before demand and supply are firmly in place.

That’s what some second-hand dealers try to take advantage of, promising 3-6 week lead times and prices these buyers are willing to pay. Over the past two years, selling electric vehicles has proven profitable for these dealer-importers.

And put those buyers at risk. For VW, its ID.4 is a particularly popular model with importers.

“The resolution by the UAE Ministry of Economy reaffirms our position that customers should purchase Volkswagen products only from official dealerships to ensure the high standard of experience that comes with owning a Volkswagen,” said K. Rajaram, CEO of Al Nabooda Cars, local dealers for Volkswagen, Audi and Porsche. “I would like to thank the Ministry of Economy for taking these steps to safeguard the interests of potential car buyers in the UAE.

“We echo the voice of our colleagues at Volkswagen Middle East that the interests and safety of our customers are above all else.”

We welcome this (Ministry of Economy) resolution.This ensures that all Volkswagen vehicles sold in the UAE are sold through officially recognized dealerships and – importantly – certified to meet the requirements of the UAE market

——Volkswagen Middle East Spokesperson

Electric vehicle sales in the UAE account for 4-5% of the 200,000+ new car sales in 2022, with fleet orders accounting for a significant portion of demand. Owners of EV models from Tesla and other manufacturers are also on the rise.

Suliman Al-Zaben, Hyundai and Genesis brand director at Juma Al Majid Est, said: “Starting this year, more UAE dealers will offer electric vehicles as well as hybrid and gas-powered vehicle options.” Prices remain high due to technology costs – which means they will take longer to find buyers who prefer cars priced below Dh100,000.

“Electric cars need to be priced well below Dh100,000 to be profitable in the mass market.”

Multiple industry sources said they were studying whether Chinese automakers would accelerate the rollout of their own EV options now and over the next five years. Specifically, they believe that the Chinese may soon launch models priced around Dh120,000-Dh150,000 before dropping further. This will be a major breakthrough moment for electric vehicle sales in the UAE. “

Local dealers are also pinning their hopes on an increase in sales of hybrids before EV demand in the UAE really expands and expands. Even mass-market models are now available as hybrids in showrooms—or by subscription.

“It’s not just the immediate increase in buyers’ demand for EVs, hybrids will lead the transition,” said one dealer. “Here, you can already see models retailing for under Dh100,000. UAE car buyers are seriously considering hybrids.”