Middle East targeted for supercar investment

Super car manufacturer Koenigsegg is on the lookout for Middle Eastern investors to help it expand production capacity at its high-tech headquarters in Sweden.

The company, which makes some of the fastest production cars in the world, is seeking additional funding to support the release of a new four-seat saloon. The move would extend ties between the firm and the Gulf as it bids to grow sales to cash-rich local buyers.

Andreas Petre, the firm’s regional head, told Arabian Business: “We are looking at new injections soon because we are looking to expand the factory. We will need investment and finding investment in the Middle East is not that difficult.”

The move would be the first time an Arab investor has linked up with the company, which was founded in 1993 by Swedish car buff Christian von Koenigsegg and competes with the likes of Bugatti and Pagani at the top end of the super car market.

Its cars include the CCR — which once held the world production car speed record at over 388km/h — and current model the CCX, which sells for around $1 million upwards. According to Petre, the new saloon model is tabled for launch in 2010 and will be “slightly cheaper and produced at slightly higher volumes” than its existing two-seaters.

The move also comes as the company is expanding its Middle East operations, which are managed from an office in Jebel Ali, Dubai. Its UAE distributor, the Al Otaiba Group, opened a showroom in Abu Dhabi in November 2007 and Petre said Koenigsegg had just agreed to enter Bahrain through a partnership with local dealership Hamad Zayani & Sons Motors.

He said around 10 of its cars had been sold in the region so far, with a further five on order: “We have local distributors in most GCC countries and we are in the middle of finalising Bahrain. After that, we will be in every GCC country apart from Oman.”

With the company entering new international markets, Petre said Koenigsegg was looking to increase production capacity at its base in southern Sweden to around 35 vehicles per year.

He said it had sold around 60 cars so far, but predicted it would generate a significant amount of new business from the US. The firm was recently permitted to enter 46 States after passing safety and emission standards, and Petre said it was already taking orders for 2009 deliveries.

Petre said: “We’re selling more cars than we are currently producing and we’re increasing production each year. Two years ago, we built six cars and last year we built 13. We’re building 20 this year and we hope to build 30 to 35 cars per year a couple of years from now.”

But he added: “We will never build more than 35 a year. We’re not a volume manufacturer.

“Our clients are not very price conscious. The two major factors are exclusivity and delivery times. They want to know how many there are in their city. If you can deliver a car in eight months and tell them they will be the first person in Riyadh to have one, they will be very keen to buy.

“Price to these boys is not an issue. They want something no one else has.”

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