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Egyptian unrest reaches into auto industry

Automakers ride a rollercoaster of positive sales numbers and political instability.

By James_Tate Jul 8, 2013 12:19PM

Cairo, Egypt - Getty ImagesThe recent uprising in Egypt that led to the military ouster of President Mohammed Morsi has affected every aspect of Egyptian life and business, and the auto industry is no exception. From sales numbers to production lines, Egypt’s auto business has been riding waves of turmoil and recovery since the 2011 Arab Spring demonstrations toppled the regime of Hosni Mubarak.


Morsi’s removal from office came just days after industry analysis revealed a 12 percent year-to-year increase in car sales for the first five months of 2013. The sales figures depict a stunning resurgence of consumer confidence; the Egyptian market entered a period of intense unease following Mubarak’s departure over concerns for the future of Egypt’s government and economy.


As the Arab world’s most populous country and the third-largest car-producing nation in Africa, Egypt is an immensely important market on the world stage. Small Chinese and Japanese cars have benefitted the most from the sales increase, thanks to their relatively low costs and fuel efficiency -- important to bear in mind when the government keeping gas prices low is toppled. Asian builders weren’t the only ones to make the most of the buying surge: General Motors has the best-selling brand for 2013 in Chevrolet, as well as the Opel brand, which it sells in Egypt; truck sales also experienced a fifteen percent increase over 2013’s first five months. We’ve yet to see how current events in Egypt will affect auto sales. Considering that the overall year-to-year sales increase fell from 14 to 12 percent from April to May, the auto industry may be facing another sales dip like the one experienced in 2011.


Some manufacturers have already felt the impact of the massive demonstrations and Morsi’s removal firsthand. BMW and General Motors both shut down dealer and production units the day after Egypt’s military ended the Morsi presidency. Toyota’s Egyptian production facility ran throughout the crisis, but it did close all of its dealerships for three days as a safety precaution while hundreds of thousands protested. The interruption appears to be short-lived for manufacturers, however: the BMW and General Motors facilities that were shut down were all scheduled to be back up and running on July 7th, and Renault’s 38 dealerships across Egypt never closed during the crisis.


On a list of concerns over the current situation in Egypt, how cars and trucks are selling isn’t near the top of it, nor should it be. As elections are held and Egyptians attempt to get back to something resembling a normal life, the performance of the auto industry will be an important harbinger of where the country might be headed. Egypt has population of more than 80 million, and with total car and truck production of fewer than 40,000 units in 2012 during a period of intense sales growth, the potential is there for builders to make a big push in a re-emerging market. What happens next is in the hands of the citizens of Egypt.       

  

[Sources: Automotive News; MSN.com; News.UK.MSN; Wall Street Journal

14Comments
Jul 13, 2013 7:53AM
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I could care less about Egypt's economy. I'd like to focus the discussion on why the U.S. continues to abuse tax dollars and increases debt.
Jul 13, 2013 9:47AM
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And we just gave them 1.3 billion in foreign aid, went are we going to mind our own business and take care of business here in the USA? Rand Paul has  the right idea...
Jul 13, 2013 12:11PM
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Egypt is a waste,  we send them money and no good comes of it,  it is past time we let these 3rd world s**t holes be and we move on to where we worry only about the USA.  Or carpet bomb the whole place and to the victors goes the spoils,  we keep and run and own the lands we liberate or conquer
Jul 13, 2013 6:10AM
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I realize the difficulty in writing about nothing. MSN is to be congratulated for bring this non news item to our attention.
Jul 13, 2013 12:53PM
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Didn't know camels were classified as cars.
Jul 13, 2013 2:28PM
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what a bunch of crap, if it wasn't for American tax dollars going there they would all be back in the stone age again.  Wake up Obama there isn't enough money in the world to make them like you.  Let them continue to thin the herd like they have done for millenniums. you see what American blood and money bought us in Iraq and Afghanistan, they still hate America and all that we stand for.
Jul 13, 2013 2:54PM
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But I'm SURE they want you all dead. DEAD DAED
Oct 8, 2013 3:24AM
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 hahaha you ****ing  a** ho*les

 

 you think your any smarter get the **** out of  our country and we will demolish israel of the mappp hahhahah    we will screw the for you and they will come cry to you   we dont need your help   russia is always scaring the living **** out of you ...............

Jul 13, 2013 9:21PM
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I wish a peaceful resolution can be made soon,Egypt is a country on my list of places to travel to! They also export the worlds best cotton products!
Jul 13, 2013 2:49PM
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Actually, it comes from the TRIBE, ya freakin' retards. WHITE POWER.
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