Table:-7In UAEdue to lack of parts manufacturing industries local authorized suppliers aresometimes falling shorts of car part. Targeting this opportunity there has beena lot of small-scalecar part suppliers in the market especially in the Northern Emirates. As per theory, the bargaining power is always higherwhen the suppliers are less in the market but in this case, the gap is overcome by other third party players. Thereforethe bargaining power of the supplier is relatively low when compared with otherelements from Porter’s five force model.
3.4. Bargainingpower of SupplierAspart of Vision 2030 Dubai’s Road and Transport Authority(RTA) along withHyperloop One is going to implement a high-speedrevolutionary transportation project. This project is a part of the vision ofowning world’s leading infrastructure andalso in the region.(Salem, Sara.A.
A,2017) (Gulf News, 2016)Table:-6Inline with the vision of Dubai 2030, thetransportation sector’s 25% would be driverless and smart. This would benefit an economywith an annual saving of more than Dh22 billion.(Gulf News, 2016)3.3. Threatof new entrants TheUAE bus system help around 30million people to commute on a daily basis withmore than 193 routes provided on weekdays. The system has unique routes ofabout 59 of which also helps people to travel without any hassle. However, the bus network is mainly used by the low-income group and there isn’t much done toattract high-income groups and thereforethe major problem still remains to be the traffic congestion.
(Vinod, Robin, 2015) 3.2.3. Buses/Taxi The implementation ofMetro and trams was a great success to commute across the city for theresidents. Due to its huge demand, thegovernment has agreed on the refurbishing of five main metro stations like BurjKhalifa, Dubai Internet City, Mall of Emirates, Emirates Exchange, and DAMAC.
Currently, the entire metro system transports more than 650,000passengers daily. (Priest,Mike, 2017) 3.2.2. Metro/tramsAspart of Dubai government’s initiative ofbuilding a healthy society, the Roads andTransport Authority has undertaken the project of constructing cycling tracksthat pass through residential areas likeJumeirah Beach, Downtown, Oud Metha and many more. The agreed plan is to builda total cycling length of 500km in Dubai by 2021.
(Cerna, Fatima D.L., 2017)3.2.
1. CyclingThe primary threat wouldbe the evolving public transportationsector here in Dubai. The government has taken up various projects to enhancethe use of public transportation sector by introducing a new innovative way to commute.3.2.
Threat of Substitute Bringinga flat economical year in 2016, which caused an effecton various sectors such as lack of new securitiesfollowed by consolidation and salary reduction had pushed the consumers to be more price cautious. (Cooper.F 2017). All these factors are a strong indicatorof how price sensitive is a major point for most of the country’s population. The above graph shows the demand for retail value dropped due to various factors. Table:-5 Ina recent survey conducted it states that a largenumber of population in UAE considered price as the major factor forpurchasing of any product. It was found that price and quality are the majordriving factors for any purchase decision.
Considering Expect, Females and Studentsbetween the age group of 18-30 are more pricessensitive than other demographic groups. (Pujari .V 2012) In2008 when citywide bus service was introduced in the Capital an estimate of50,000 people used the bus services,these numbers increased dramatically evenafter the fares were increased to Dh1 for free.
But after two years when thecharges were increased to Dh2, the number of users dropped.(The National 2014)3.1. Bargainingpower of buyers:-3. Porter’sfive force Analysis For moreexplanation on the topic please refer Appendix 1. Strengths Weakness · Unique idea and first to implement · Friendly user interface with real-time updates and feedback system · Lack of updated database on auto workshops in the region · Absence of criteria for monitoring the workshops Opportunities Threats · Higher vehicle density · Annual Increase in the number of registered vehicles.
· The total value of UAE’s used car market of around US$2.5 billion in business. · Regulations on new vehicle issuance to be implemented · Strong public transportation network · Innovative and sustainable transport facilities like Hyperloop and Tesla taxis. 2. SWOT Analysis (United Arab Emirates Consumer Confidence,2017)Table:- 4In theUnited Arab Emirates, the second quarterof 2017 showed slight growth in consumer confidence from 108 in the fourthquarter of 2016 to 110 currently.
The highest recorded consumer confidence wasin the first quarter of 2015 whereas thelowest was in 2010 fourth quarter with 115 and 97 respectively. The averageconsumer confidence in the UAE is 108.03 for the years between 2010 to 2017. Inthe coming 12 months timeline, theconsumer confidence stands at 107.00. Accordingto the forecast, the consumer confidencetowards is estimated to be around 109.00 by 2020.(United Arab Emirates Consumer Confidence, 2017) 1.
2. UnitedArab Emirates Consumer Confidence(Emirates NBD, 2014)Table:- 3In theentire MENA region, UAE is considered as a regional hub not only for cars butalso for vehicle components and parts because of being one of the largestimporters of used cars. Hence, the country plays an important role among theGCC region positioning themselves as a major re-export center. (Emirates NBD, 2014) 1.1. AutomobileImports to the United Arab Emirates 1.