The number of automobile auction companies operating in the EAU have increased to almost 20, according to industry experts, and daily auctions are now a common feature in Dubai and neighbor Sharjah.
“With the power of social networks, the last type of three years is what would say that when many more people have granted Gooths to this concept of” hey, maybe you can have passive income when buying and selling at Marchidi auctions, Eabair Rashidi Arab business.
Marhaba Auccions, founded in 2018, makes daily auctions that drive up to 7000 monthly vehicles through four branches in Dubai and Sharjh, using a hybrid model that combine combined and online offers.
Significant returns
Mohamed Moaty, a 42 -year -old flight attendant who began investing in auction records in 2009, he said Arab business Hello, typically obtains “10 percent minimum up to 50 percent of net gain” in the purchase of vehicles in an auction.
The supplementary income has transformed his lifestyle and has allowed him to buy luxury items that once was considered beyond reach.
“Great difference. I never thought I would buy a rolex, but I bought my first and a Patek Philippe is on its way,” said Moaty.
For Ihab Salem, 46, the company began by chance when a friend invited him to an auction. He now informs that they win between AED35000 and 50,000 ($ 9,530- $ 13,615) per car, mainly of Sharjah auctions.
“There are many auction houses in Dubai and Sharjah, but mostly I’m going to Sharjah,” Salem explained. “Each auction has specific days, and different companies direct them. They do not overlap, there is an agreement without speaking between them to keep their auctions in separate days.”
Market challenges
Despite the potential of high yields, participants face considerable risks. Salem warns that vehicles in an auction of hidden problems that can only be evident after purchase.
“One of the biggest challenges is that, despite trying the car before buying, it can still end serious problems that only become equipment later,” he said. “The auctions sell cars that have been ruled out, either due to accidents, floods or other reasons, so buyers must be aware that they are obtaining vehicles in poor condition.”
Salem told an instance in which repair costs exceeded the value of a vehicle, which forced him to sell with losses.
“Sometimes, do not discover hidden damage until after purchase, and repairs can end up costing more than the car.
The floods of April 2024 that extended through parts of the EAU created opportunities and difficulties for the auction market, according to Rashidi.
“Flood last year had a positive and negative impact on the auction market,” he said. “On the one hand, those who lost their cars sought to obtain a replacement car for commercial or personal use, and reached the auctions.”
Marhaba’s auction responded to the disaster by offering financial incentives to affected residents. “We publish a press release to support the communities and offered up to 10,000 AED troops in any purchase for all the EAU residents for the flooded car,” Rashidi added.
However, erroneous concepts on auction houses that sell vehicles damaged by floods affected general sales, Rashidi pointed out and emphasized that Marhaba’s auction does not accept cars damaged by floods.
The increase in competition presents another obstacle to those in the business. “The biggest problems today are competitors, many freelancers car merchants in the market that make it more difficult but is still possible,” said Moaty.
Industry growth
The EAU auction sector has grown significantly since its inception in 1997, with a second wave of growth after the 2008 recession, according to Rashidi.
“The first cars auctions in the EAU really begged in 1997. The second wave was after the recession in 2008 when some others entered the market,” he explained. “Marhaba’s auction was founded in 2018 and our concept was slightly different as a hybrid auction.”
This hybrid model, which combines traditional offers in person with online participation, has helped feed the expansion of the sector. “We carry out live auctions on the site that also accumulate online, where sentences could also buy cars through the website or application,” Rashidi said.
The main players in the market include the Emirates auction, the EU of Copart and the Dubai car auction operated by the road and transport authority (RTA), together with smaller operations such as Sama Car Auction and Nojoom Cars Cars Cars in Sharjah.
The country’s reputation as an automotive center has contributed to the expansion of the sector. RM Sotheby’s celebrated its first Dubai auction in 2024, with high-end sales that include a Mercedes-Benz SLR McLaren Stirling Moss 2009 by AED11.8 million and a Aston Martin Valkyrie Coupé 2023 by AED11.3 million.
“Everyone knows the EAU for being very popular for the automotive industry, from the Dubai Police with elegant cars to the Supercar Clubs,” Rashidi said. “Eau residents have many different options available in the market, from Japanese to Europeans, Koreans, Americans, Canadians through concessionaires and used car markets, classified online and then auctions.”
Advice for newcomers
For newcomers who consider entering the market, Salem recommends thorough preparation. “Visit some auctions first. Talk to experienced buyers, observe the process and learn how inspections are carried out.”
Hello, however, he highlighted the speculative nature of the business. “At the end of the day, it is a bet: the more experience you have, the better it will be to detect good offers and minimize losses.”
Not all participants deal with cars flip as a main business. “For me, this is just a hobby, not a business. I don’t believe a merchant, I do it for fun,” Salem said.
“Some people do this full time, selling cars in nearby countries such as Syria and Iraq. From time to time, I will buy a car, I will use it for a while, I fixed it and then I will.”
Rashidi describes the auction experience as very attractive. “This is the environment. This is the atmosphere of live auctions, the offers, the speed of the auctioneer, the people who raise their palettes to offer and the emotion in their faces when they win the car as the best bidder. It really is really.” “
