The Lebanese economic backdrop remained bleak in 2014 on account of the spillovers of the Syrian war and the internal political deadlock. The growth of the country’s Gross Domestic Product (GDP) stood at a meager 1.8% in 2014 as the slowdown was felt across all the major sectors of Tourism, Real Estate and Construction. In particular, the private sector was dealt a tough-hand as shown by the BLOM Lebanon PMI which averaged 47.6 points during 2014. The index remained below the 50 – points mark, separating economic contraction from economic recession for the entire year.
Amidst these tough operating conditions, it is no wonder that Lebanese car importers reported yet another sour year. The Association des Importateurs d’Automobiles au Liban (AIA) stated that the profits of car importers dropped despite the continuous efforts poured into advertising and promotional campaigns. The weak economic conditions led to a low sales turnover which was combined with a reported increase in charges and salaries. In fact, the net income of a major car importer, Rymco, the only one to be listed on the Beirut Stock Exchange, dropped by 29% year-on-year in the first half of 2014 to $1.53M. This came as a result of the 15.18% surge in cost of goods sold, that exceeded the 8.92% increase in net sales to $78.33M…
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The Lebanese Car Market in 2014 Still Suffering from the Poor Economic Backdrop