INVESTMENT WATCH- GB Auto aims to hike capex by 10-15% next year: GB Auto is hiking its capex spending by 10-15% next year, CEO Raouf Ghabbour told Al Mal. The firm plans to invest up to EGP 500 mn next year in aftersales and other facilities, with the company set to launch five new maintenance centers in the coming period. Crucial to the decision, is Ghabbour’s prediction that interest rates are likely to come down next year, which would help spur consumer spending and drive up auto sales. Ghabbour sees passenger car sales growing 15-20% industry-wide next year as a result.

Lack of coherent policy for the sector behind current stagnation: Ghabbour sees the lack of a coherent government policy for the automotive sector as contributing to the stagnation of the sector. He noted that the continued stalling of the automotive directive — legislation that would give incentives to local assemblers to move up the value chain to manufacturing in return for tax breaks that would give them an ongoing price edge against EU, Turkish and Moroccan-made imports — has hurt local assemblers. He also reiterated that customs on EU-made cars falling to 0% next year would not make cars cheaper.

Industry standards can’t be dropped on the sector like bag of bricks: Ghabbour also noted that the government’s decision to impose some 20 new quality control standards on the auto industry in one fell swoop would prove difficult for local assemblers. The Trade and Industry Ministry’s Organization for Standardization & Quality (EOS) is planning to enforce around 400 new quality standards across several industries before the year is out.