Perhaps, the whole world is on the verge of witnessing the economic slowdown, earlier, news from India was declaring economic slowdown and now the report of the UAE has emerged sating the same. An industry expert from the gulf news has reported that the consumer electronics industry in the UAE is expected to fall by 0.23 percent to Dh11.95 billion, compared to Dh11.97 billion last year
Ahmad Bakr, the research analyst at Euromonitor International Middle East, has said that sale figure is more than the last year but, the profit has dropped due to the decreases in average selling price.
“Volume is expected to register a 1.8 percent growth but it is lower than last year. Volume for this year is expected to be 12.65 million compared to 12.4 million units last year. The reason is due to the overall slowdown in consumer electronics market. Small appliances are witnessing a negative growth,” he said.
In the electronics goods, there is a significant fall in the laptop segment as more and more people are nowadays using smartphones. However, gaming laptops and architect portable workstations have seen growth in the sale. Among the other segments which saw the growth in the sale are action trackers and natural light-emitting diode (OLED) TVs.
“The fastest growing category under portable consumer electronics is activity wearables due to growing activity awareness and healthy lifestyle among the people. Wearables, including trackers and smartwatches, are growing 60 percent in volume and 32 percent in value,” he said.
OLED TVs has seen a growth of 28 percent in volume, it’s because many new players have entered the market. It must be noted that in UAE, KG, is still the number one electronic’s company in the OLED TV space. But, last year Sony, Loewe, Toshiba, Grundig, Philips, Bang and Olufsen and Panasonic have entered this market. He said that tablets are seeing a growth of 1.3 percent while home cinema and speaker systems are seeing an 8.9 percent growth.
“Bluetooth speakers are growing 24 percent in value but smartphones are growing at 3.2 percent in volume but lower compared to 9 percent last year but in terms of value, it is witnessing a slower growth of 4.18 percent,” he said.
He included that cameras in smartphones have been enhanced and hence resulting in the lower sales report of DSLR and analog camera. The sale report of the camera states that there is a drop of 9 percent in volume and 10 percent in value. Apart from these, the Camcorder sales are expected to fall by 24 percent in volume and value both.
VAT is presumed to slow down the economy of UAE for the first three months of implementation. According to many industry experts, the upcoming VAT in UAE will impact the economy of the nation adversely and the first three months will be the hardest. It’s worth mentioning that GCC-wide value-added tax (VAT) is scheduled to launch in 2018 in UAE.
“Consumers are very pessimistic and very scared and that is going to hit consumer confidence in a big time. But when VAT comes into play and consumers see that the prices have not increased much, except for big appliances and big TVs, they will go and buy it but it will impact in the first quarter of next year,” said Ahmad Bakr, research analyst at Euromonitor International Middle East.
Euromonitor anticipates that sales will be boosted from June or July. “People will buy their products before VAT is introduced and that will slow down the industry for the first three months,” he said.