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Wed, Nov 13, 2024 | Jumada al-Awwal 12, 1446 | DXB
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Kavak set to change face of pre-owned cars’ market in Mideast
The Mexican firm’s merger with regional player Carzaty leads to opening of largest customer hub in Dubai
Kavak is a technology and data-driven platform for used cars with an extended presence in 10 countries including Turkey and now, the GCC.
Kavak has opened the largest customer hub in the world in Dubai, which is set to revolutionise the pre-owned car industry in the six-nation Gulf Cooperation Council (GCC).
Kavak, which is valued at $8.7 (Dh31.96) billion, recently announced its merger with regional player Carzaty, which was incubated in the Sultanate of Oman.
Though Kavak has a physical presence, the buying and selling process can also take place online at kavak.com to service a wide array of customers in the region.
“Quality standards have become the highest point of discordance in the global used cars market. Kavak’s model has disrupted the industry to provide consistency and reliability," Marwan Chaar, co-chief executive officer (CEO), Kavak, GCC; and one of the brains behind Carzaty, said.
"Our customers can feel trust and reassurance in the car they are buying. Kavak also offers customers up to two years in warranties, ensuring their peace of mind. The GCC region presents a vast opportunity to bring a transparent, high-level user experience for the buying and selling of used cars and we are excited to be on this journey with Kavak,” he said.
Hassan Jaffar Al Lawati, co-CEO, Kavak, GCC; and the other brain behind Carzaty, said: “When we launched Carzaty in Oman we were problem-solving for immediate market needs — to create a data-driven business that could best address customer demands with a strong focus on improving the customer journey. With an investment from the Omani government, we were equipped to build the foundations of our business locally and expand into the UAE which acted as our launchpad to scale. As we start this new chapter with our colleagues at Kavak, we are excited to bring our local market knowledge to their global playbook as we double down on the UAE and Oman and expand further into the Kingdom of Saudi Arabia (KSA) and the rest of the GCC.”
Founded in Mexico in 2016 by Carlos Garcia Ottati, Kavak is a technology and data-driven platform for used cars with an extended presence in 10 countries including Turkey and now, the GCC.
Carzaty was founded in 2018 in the Sultanate of Oman by ex-McKinsey consultant Hassan Jaffar Al-Lawati and Harvard Business School alumnus Marwan Chaar, is an online platform to search, compare, buy and finance new and used cars.
'High-quality cars and incredible customer experience are our USPs'
Marwan Chaar, co-chief executive officer, Kavak, GCC (pictured below right) spoke exclusively with Khaleej Times on the sidelines of the launch event on November 10.
Edited excerpts from the interview:
What are the product differentiators?
Kavak focuses on two things: high quality cars and an incredible customer experience. We own all our cars, no middlemen. We provide long-term warranties on the car that are backed by our own in-house reconditioning centre.
How Carzaty is helping Kavak to expand in the region?
Carzaty was acquired by Kavak because of our local expertise and knowledge of the region. We started operations in the Sultanate of Oman and expanded to the UAE. My Omani partner Hassan Jaffar Al Lawati and I are the two co-founders of Carzaty. We were born and raised in the GCC and built a company for the region.
What’s the initial target for Kavak as far as buying and selling cars are concerned?
Kavak is already one of the largest used car retailers in the UAE and our plan is to double in size by mid-2023 growing our inventory to over 1,000 cars and serving 1,000 customers per month. The initial investment in the region is $130 (Dh477.49) million for the next two years and targets the Kingdom of Saudi Arabia as our next market for growth.
How can Kavak disrupt the secondary car market in the region?
Kavak disrupts the market from two sides: for customers selling their cars, we provide the highest instant cash offering in the market with same day purchases and the convenience of home service. For customers buying cars from us, we provide a wide selection of high-quality cars at transparent fixed prices removing the haggling typically associated with used car sales. In addition, the budget that Kavak has allocated to the region will allow the company to scale its inventory and to build world-class facilities that better serve the customers.
How has the impact of the launch been?
The feedback of the customer experience has been very positive. Customers love the experience. We expect traffic to the hub to grow quickly following the launch, which will increase the number of cars that we buy and sell.
— joydeep@khaleejtimes.com
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