Several used car showroom owners told Arab News that the prices rose 20 percent over the past two months and that they believed they would remain at that level because of the upcoming summer vacations.

A meeting of the Automobile Committee of the Eastern Province Chamber of Commerce and Industry urged the authorities to relax the rule and ban cars older than eight years.

Ali Hussain Alireza, the chairman of the Automobile Committee at the Jeddah Chamber of Commerce and Industry said that 50 importers annually imported a total of 400,000 cars to the kingdom from various parts of the world and that stiff competition sent prices falling to the lowest possible levels.

“Some people expected the prices to fall by 30 to 40 percent. This is not true as prices of steel, aluminum and other metals used in manufacturing car parts did not fall. Hit by the financial crisis, international car companies suffered heavy losses last year and in the first quarter of the current year. They have cut down the volume of production to grapple with higher production costs,” Alireza said.

He said he believes the sale of cars in the kingdom will fall by 20 to 25 percent, particularly as new models are to hit the market soon.

First seen on Arab News.