For 36-year-old Maha Ghalib the decision to allow women to drive means getting her hands on the keys of a shiny new black Mustang.
The Jeddah-based marketing manager is already planning her first auto purchase.
“Currently my private driver costs SR3,200, so I will be able to save money,” she told Arab News.
“I think the older generation of women will keep their drivers, but the younger generation will learn to drive.
“We never thought we’d see this in our lifetimes. We are thrilled. It is an economic decision, it will be good for car dealers, for workers, for families.”
She is just one of thousands of women across the Kingdom whose daily lives are set to be transformed.
Car dealers are set to reap the benefits.
David Oakley, EMEA analyst at LMC Automotive said: “Currently Saudi Arabia’s car density (the number of cars on the road per 1000 adults) is only a little over 200, but this announcement could help Saudi’s car density to catch up with that of its neighbor, the UAE, at around 300 by the middle of the next decade.”
The analyst said this would translate into an increase in new car sales of around 15-20 per cent per year until the mid-2020s.
The Saudi car market reached a peak of 685,000 units in 2015, but sales fell by around 18 per cent in 2016 on the back of lower oil prices and a sluggish economy. Sales have continued their downward trend so far this year, and are forecast to end the year at just 530,000 units, before starting to recover in 2018.
Oakley said: “Although Saudi Arabia has a reputation for luxury, the reality is that the market is dominated by non-premium brands. The non-premium segment accounted for 93 percent of all cars sold in 2016, while premiums and super-premiums accounted for just four percent.”
According to LMC Automotive data, last year the top three passenger car brands were Hyundai, with a 28.6 percent market share, Toyota at 28.4 percent, and Kia at 8.3 percent.
The top three premium brands were Lexus, Mercedes-Benz and BMW. Lexus sold just over 9,000 cars in Saudi Arabia last year, while Mercedes sold almost 4,200 and BMW a little under 2,900.
Oakley said: “We believe that the move to allow women to drive is set to benefit the entire market, as all brands will need to consider how to appeal to the diverse range of women who will be getting behind the wheel for the first time.”
Wes Schwalje, COO, Tahseen Consulting, said that if female labor market participation rates in the Kingdom rise significantly over the next several years, the Kingdom is likely to witness vehicle ownership rates converge towards approximately 500 vehicles per 1,000 people. “This could mean an incremental six million cars on the road in the very near future,” he said.
He added that Tawuniya — the Kingdom’s largest insurer — would also benefit significantly from new auto sales in the country.
Marhan Adhani, group marketing director of Saudi Arabian car dealer Al Ghassan said: “This will have a huge impact on the Kingdom’s motor industry. Saudi Arabia as a whole will be selling a lot more cars. We anticipate that women will be buying a lot of small sedans.”
“Women have been waiting for this for decades. It’s the biggest news ever and of course it’s a good thing. The whole of Saudi will change.”