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24 • 2017 ANNUAL REPORT
2017 ANNUAL REPORT • 25
Chery, GBAuto is able tomarket avarietyof productswith
a diverse range of sizes and prices.
Over the years, the company has solidified its market lead-
ership with a dedication to value, unparalleled service, and
best-in-class products. GBAuto created its “one-stop-shop”
approachtoretailautobuyingbyverticallyintegratingsales,
consumer finance (through Drive, GB Auto’s consumer fi-
nance venture), and after-sales support. Its commitment to
total customercareallows thecompany toofferEgypt’scar-
buyingmarket apowerful valueproposition—GBAutohas
long positionedHyundai cars as the best value formoney in
GBAuto is the largest player intheEgyptianpassenger car
market in terms of sales revenue, market share, and pro-
duction capacity. It is a leading passenger car importer,
assembler, and distributor in the Middle East and North
Africa. The company holds the exclusive license to as-
semble and distributeHyundai andGeely passenger cars,
and imports and distributes Hyundai, Geely, and Mazda
passenger cars, as well as spare parts for all three brands.
GB Auto is also the exclusive distributor for Chery-brand
vehicles inEgypt, through a tripartite agreementwith the
Chinese company and Egypt’s Aboul Fotouh Automotive
(AF Automotive). Through Hyundai, Geely, Mazda, and
Egypt
Passenger Cars
the Egyptian market and has more recently done the same
withGeely,Mazda, andChery at their uniquepricepoints.
GB Auto has invested significantly in the expansion of its
assembly capacity. At the Prima plant, the company as-
sembles Hyundai and Geely passenger cars from import-
ed CKD kits, as well as locally sourced components. The
plant — which spans across nearly 58,000 square meters
— was established in 1994 and by January 2016 had pro-
duced more than 285,000 passenger cars. In September
2012, GB Auto completed a major investment, growing
production to include its new Geely models while mod-
ernizing certain aspects of the assembly process. Today,
Prima is a state-of-the-art facility with fully-automated
conveyer systems, robots for painting, andmore.
2017 Business Review
The Passenger Car industry was sluggish over the last year
as consumers had only just began to recover from the af-
termathof theEgyptianpound’sfloat in2016.Nevertheless,
the sector began to show vivid signs of recovery during the
last two quarters of the year, with GB Auto recapturing
market share during the year, which climbed to 31.1%, in-
cludingHyundai, Geely,Mazda, andChery, in-linewith the
level recorded last year. Management is optimistic about
the sector as low-marginmodels are cleared fromthemar-
ket andmoreprofitable ones begin taking their place.
According to the Egyptian Automotive Marketing Infor-
mation Council (AMIC)’s full-year report on the Egyptian
Passenger Cars market, the total automotive market fell
29.9% y-o-y in FY17. More specifically, vehicles within the
1.0-1.3 liter range witnessed a 29.4% y-o-y decline in vol-
umes, while those within the 1.3-1.5 liter range fell 26.1%.
Meanwhile, vehicles within the 1.5-1.6 liter range saw
sales volumes decrease 6.6%, while SUVs with an engine
capacity larger than2.0 liters sawvolumesdrop4.7%y-o-y.
FY17 saw GB Auto’s Egypt Passenger Cars division de-
crease its sales revenues by 14.7% y-o-y to LE 6,840.5 mil-
lion compared to LE 8,016.1 million in FY16 as demand
for passenger cars weakened during the year due to the
continuing rise in vehicle prices. Despite sales volumes
dropping40.2%y-o-y,GBAutowas still able tomaintain its
market share by capturing existing underserveddemand.
The company’s share of the Egyptian passenger car mar-
ket, which includes Hyundai, Geely, Mazda, and Chery,
rose to 31.1% YTD in December 2017 compared to 36.8%
last year. The availability of inventory and competitive
pricing strategies were key to GB Auto’s success during
the year as low-margin models were cleared from the
market andmore profitable ones began taking their place.
Hyundai maintained its number one market leadership
position with a 21.9%market share for the full year.
Since its launch in 2016, Chery has delivered promising
results in terms of bothprofitability andmarket share. In
FY17, Chery’s market share stood at 4.6%, relatively flat
on a y-o-y basis, with 4,588 units sold during the year.
Egypt Passenger Cars
Revenue Segmentation of the Egyptian
Passenger Car Market by Year
(Units sold and % Market Share as of Year-End 2017)
Hyundai
16.1%
21,897
Nissan
15.6%
21,181
Chevrolet
21.6%
29,345
Chery
4.0%
5,477
Geely
2.1%
2,804
Revenues by Year
(LE million)
2010
5,383.0
2014
8,909.9
2012
6,072.3
2016
8,016.1
2011
5,741.9
2015
7,489.9
2013
6,536.9
2017
6,840.5
Egyptian PC Market Annual Sales
(LE million)
FY06
133,591
FY10
192,848
FY08
198,800
FY12 FY13 FY14 FY15 FY16
144,204
133,760
207,973
195,559
FY07
179,178
FY11
133,165
FY09
158,926
FY17
141,983
99,530
14.5
%
of FY17 Group
Gross Profit