In the first quarter of 2014 we revised up our forecast for 2013 new vehicle sales in Gabon from 3.8% to 9% y-o-y, on the back of a better than expected vehicle sales performance in the first half of 2013, when the Union of Automotive Industry Representatives (URAI) estimated that new vehicle sales grew 9% y-o-y, 3,062 units, in H113. We are of a similar view this quarter. We forecast total sales to rise 8.3% in 2014, to 6,302 units. Growth will average 8.3% in 2014-2018. Passenger car growth will average 8.0%, with 5,301 units shifted in 2014.
While this is partly owing to favourable base effects from nearly a 10% y-o-y decline in sales in 2012, the URAI attributes the growth to the resurgence in public and private sector activity during 2013, which clearly translated into increased vehicle demand. We believe that the vehicle demand could have also been bolstered by the strong euro which has lowered the real cost of vehicle imports.
In the medium to longer term, the increasing role of the non-oil sector of the economy will serve to drive private consumption and manufacturing activity in the country, which will assist vehicle sales.
However, while oil-rich Gabon is one of the wealthiest countries in Sub-Saharan Africa, a recent report compiled by McKinsey suggests that a third of the country's households live below the national poverty line of XAF80,000 (USD169) per month.
Updated historical data indicate that Gabon's non-oil sector is expanding more rapidly than we had previously anticipated, and this has led us to upwardly revise our 2014 real GDP growth forecast from 5.5% to 6.8%. President Ali Bongo's diversification drive, which aims to transform Gabon into an 'emerging economy' by encouraging the growth of non-oil industries, is succeeding to a degree which we had not foreseen. We still believe that the president's goals are overly optimistic, but note that investment in infrastructure projects has boosted headline growth. We also believe that heavy state...
The Gabon Autos Report features the latest data and forecasts covering production, sales, imports and exports.
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