United International Transportation Co.’s (Budget Saudi) used car sales reached an all-time high of SR 122 million ($32.5 million) in Q4 2020, President and Group CEO Fawaz Danish told Argaam in a telephone interview.
The sale of used cars is an essential part of the company’s business, accounting for 70 percent of Budget Saudi’s profit in the past years. Sales are recurring on a quarterly basis, and new cars are purchased to meet the market demand.
Budget Saudi increased the sales volume of short-term rental cars in Q4 and partially in Q3 2020, as these cars topped market demand, which has not normalized due to the COVID-19 pandemic. The company also aimed to avoid the costs arising from the insurance of these cars, Danish said, adding Budget Saudi maintained its profit from car sales.
“We sold the cars, which are in high demand in the market. Choosing the right time and diversifying sale channels were among the reasons for maintaining profits from the sale of used cars,” the Group CEO underlined.
“We did the right thing, by selling the cars in excess of market demand. Backed by its financial capacity, the company can buy modern cars, as per customer preference, but we will continue to sell used cars going forward,” Danish concluded.
Budget Saudi reported a net profit after Zakat and tax of SR 187.9 million for 2020, up 5 percent, compared to SR 178.6 million in the previous year, Argaam reported.
Budget Saudi posts 5% net profit rise to $50.1m in 2020