GCC Automotive Wiring Harness Market Size, Share, Competitive Landscape and Trend Analysis Report, by Application, Vehicle Type : Opportunity Analysis and Industry Forecast, 2019-2026

GCC Automotive Wiring Harness Market Statistics - 2026

The GCC automotive wiring harness market was valued at $321.2 million in 2018, and is projected to reach $408.7 million by 2026, registering a CAGR of 2.9% from 2019 to 2026. By application, the chassis wiring harness segment was the highest revenue contributor in 2018, accounting for $116.3 million, and is estimated to reach $153.7 million by 2026, registering a CAGR of 3.4% during the forecast period. Saudi Arabia accounted for a major market share in 2018. 

Automotive wiring harness is an electrical assembly of various components in a vehicle that transmits power and information to a single system. It plays an important role in transmitting information about the operation of the vehicle, sending & receiving sensor signals, and supplying power.

Also, wiring harnesses are the assemblies that consist of multiple terminated wires that are installed during vehicle production. The components that are assembled include speed sensors, heating, ventilation and air conditioning (HVAC) systems, electrical devices, and other electronic components. In the automotive wiring harness industry, the wires are first cut to the desired length, usually using a special wire-cutting machine. The wires may also be printed by a special machine during the cutting process or on a separate machine. After this, the ends of the wires are stripped to expose the metal (or core), which is then fitted to the required terminals or connector housings. The cables are assembled and clamped together on a special workbench or onto a pin board (assembly board), according to the design specification, to form the cable harness. After fitting the required protective sleeves, conduit, or extruded yarn, the harness is either fitted directly in the vehicle or shipped. The GCC automotive wiring harness market trends are decided on the basis of forecast from 2019 to 2026.

The GCC automotive wiring harness market is driven by increase in wealth of the population, rise in disposable income, lower cost of vehicle ownership, attractive insurance and financing options, and availability of low-cost fuel. Furthermore, rise in demand for premium cars as well as different strategies to expand the consumer base are the factors propelling the growth of the wiring harness market in the GCC region. 
Implementation of VAT and some stricter government regulations in GCC countries and fluctuations in exchange rate coupled with grey imports and regulations to reduce carbon emissions are some of the major restraining factors of this GCC automotive wiring harness market. 

Furthermore, rise in investments in vehicle and component manufacturing and surge in automotive aftermarket ensure emerging growth opportunities for this market. In addition, increase in technology adoption, vehicle customization, and various merger and investment strategies from the giant players to expand their business can be attributed to rise in sales of vehicles in GCC. These factors are projected to offer lucrative opportunities for the automotive wiring harness market in the GCC region. 

The GCC automotive wiring harness market is segmented based on application, and vehicle type. Body wiring harness, engine wiring harness, chassis wiring harness, HVAC wiring harness, and sensors wiring harness are studied under the application segment. Based on vehicle type, the market is categorized into passenger car, commercial vehicle, and two wheeler. The market is analyzed across countries such as Saudi Arabia, Kuwait, UAE, Qatar, Bahrain, and Oman.

Key players operating in the GCC automotive wiring harness market are Kromberg & Schubert Middle East FZE, Motherson Group, LEONI, Sumitomo Electric Industries, Ltd., and Abdulla Moh’d Ibrahim Trading Est. Also, various parts suppliers to the top manufacturers include Aptiv PLC, THB Group, Federal mogul, Furukawa electric Co. Ltd., Lear corporation, Schlemmer holdings GmbH, and Yazaki corporation.
Increase in disposable income

In addition to the size, the wealth of the population also tends to have a large influence on the demand for vehicles. In the last 10 years, the total vehicles in use in the GCC have moved almost steadily with the GDP per capita. The economy in GCC region has witnessed richest and fastest growth in the world, largely owing to its proven oil reserves and increase in non-oil revenue. Furthermore, personal income levels of the population are directly correlated to economic growth. Hence, rise in economy is anticipated to translate into increase in disposable income. Moreover, a tax-free fiscal environment has supported discretionary spending. In addition, with a high degree of spending power, GCC region is moving toward the adoption of the high-value products such as cars and sport motorcycles. Global automakers of luxury as well as mid-segment cars are expanding their presence within GCC countries to lure the wealthy class. An expanding consumer base results in higher demand for new as well as used vehicles and related parts in the region.

The GCC nations are also highly urbanized with more than 89% of the overall population living in urban areas. Thus, rise in urbanization rate has created high demand for vehicles, which directly helps to expand the wiring harness business in gulf countries.

Availability of fuel at competitive prices

One of the key drivers of the GCC automotive wiring harness market is availability of low-cost fuel. Large proven crude oil reserves have enabled the member countries to offer fuel at subsidized rates. The effective base price of fuel in several countries is high due to certain factors such as levy of a series of taxes related to road improvements and environmental programs. Absence of such taxes has kept the base price low in the GCC countries. The average price of gasoline in the GCC countries on October 10, 2016 ranged between $0.24 to $0.46 per liter. The highest price was in the UAE and Oman, which is still lesser than that of Germany and the UK by 35% and that in Hong Kong by 25%. Moreover, purchase of cars in the GCC is relatively inexpensive compared to other countries due to favorable tax structure with no value added tax, luxury tax, and special consumption tax. The price of the world’s largest selling vehicle, Toyota Corolla, in the GCC averaged at $16,341. Low cost of owning a vehicle in the GCC countries along with availability of fuel, insurance, and finance at competitive rates has supported the demand for cars. Thus, rise in demand for car, commercial, and two wheelers in GCC is expected to directly affect the growth of the wiring harness market.

Implementation of VAT and stricter government regulations in GCC countries

GCC governments have implemented value added tax (VAT) system at a uniform rate of 5% from January 1, 2018. Although the rate is not significantly high, it is expected to have a negative influence on automobile sales volumes owing to rise in effective sales prices. In a survey conducted among financial and investment professionals in the UAE, 79% felt that the automobile industry will be the most affected by the introduction of VAT. In addition,  some government regulations act as barriers in the GCC automobile sector. For instance, as per the UAE Commercial Agencies Law, there can only be one dealer per car manufacturer in each Emirate. Moreover, commercial agents should be nationals or companies registered in the UAE and owned entirely by the locals. In addition, rise in environmental concerns over global warming result in imposing stricter regulations on greenhouse gas emissions and promoting alternative fuel technologies in the GCC. In addition, companies are ready to meet the fuel economy requirement by supplying electric vehicles and diesel-powered vehicles in GCC through automakers (who export to GCC). Both approaches are expected to affect the type and quantity of wires used in vehicles. Thus, unfavorable policies of the government are hampering the growth of the wiring harness market in GCC region.

Rise in investments in vehicle and component manufacturing

Rise in automotive demand in the Middle East is encouraging the global automotive manufacturers to establish production base in the region. Moreover, the government also provides incentives and helps formulate plans to establish automobile manufacturing hubs. For instance, in Saudi Arabia, the government is developing a national automotive cluster as a part of the National Industrial Clusters Development Program (NICDP) with a target to produce 600,000 vehicles a year by 2025. Also, many strategies are made to fulfil the rising demand for vehicles in GCC. For instance, Saudi National Automobile Manufacturing Company (SNAM) and Saudi Arabian Public Investment Fund (SAPIF), established partnership with South Korea‘s Daewoo International to build a car assembly plan. In addition, the Sultanate has a strategic plan to commence a car plant by 2020 and automobile parts manufacturing in the GCC region in  the upcoming years. Such initiatives from the giant companies to expand their business in GCC countries are expected to help boost the demand for wiring harness required for the different vehicle types in the near future.

Key Benefits for Stakeholders:

• This study presents analytical depiction of the GCC automotive wiring harness market analysis along with the current trends and future estimations to depict the imminent investment pockets.
• The overall market potential is determined to understand the profitable trends to gain a stronger foothold.
• The report presents information related to key drivers, restraints, and opportunities of the market with a detailed impact analysis.
• The current GCC automotive wiring harness market size is quantitatively analyzed from 2018 to 2026 to benchmark the financial competency.
• Porter’s five forces analysis illustrates the potency of the buyers and suppliers in the ignition coil industry.

  GCC Automotive Wiring Harness Market Report Highlights