Setup a Used Car Business in Dubai

by Zaara 24, Aug 2021

Setup a Used Car Business in Dubai

According to the Roads and Transport Authority, do you know that Dubai has 540 cars per 1,000 people. It is the highest in the Gulf Corporation Council region and also one of the highest in the world. 

As Dubai continues to experience a rise in population, used car sales will go up since new cars have more significant depreciation. This is also increasing the opportunities for the used car business in Dubai.

Used Car Business in UAE

One of the leading investment decisions in an individual's life is deciding to buy their own car. There are many reasons for trading used cars in Dubai, UAE, and many people choose the option of the used car due to low cost.

If you really want to be a triumphant car dealer, then you have to be energetic and well aware of market trends regarding the types, pricing, and brands, which are highly in demand and should be easily available for buyers.

Activity Details for Used Car Dealers, Dubai

  • Activity Name

Used Automobile Trading

  • Activity Code

4510901

  • Activity Group

Exchange in motor vehicles and motorcycles

  • License Type

Commercial

  • Activity Description

Includes reselling used vehicles for transportation, whether being used for short or long term.

How to Set Up a Business with Dubai Used Cars?

business setup in Dubai is not a time-consuming activity at all. It will hardly take two weeks to get the trade license and start the business in Dubai. 

The only delay will be the office space and location, which you have to decide before starting the licensing process. A used car trading business in Dubai is done in 3 ways. They are

  • The business setup allows you 100% ownership and allows you to do business in Free zones
  • You can start a business on the Dubai mainland in any part. It also allows you to do business locally and internationally
  • Business setup lets you do business internationally only via offshore.

The following steps are to be followed:

  • Decide the Type of Business Activity

As you have chosen your activity as used car trading, then this license is defined as a commercial license.

  • Decide on the Type of Legal Structure

As it’s a commercial business, it should have a minimum of two and a maximum of 50 shareholders. LLC can be in only Commercial and industrial activities. 

Such companies need Dubai to sponsor their businesses.

  • Decide on the Type of Business Ownership

51% proprietorship should be with UAE nationals. The profits can be yielded in a different ratio.

  • Choose a Trade Name

The trade name plays a crucial part in the legal procedure. The trade name indicates the nature of the business.

  • Select the Location

The Dubai Economic Department has already assigned the place at "AL AWEER AUTO MARKET." The office space and storeroom have to be located inside the designated area.

  • Get a Legal Support

Setting up a used Car business in Dubai requires external approval from the Dubai Municipality – “Department of Public Market.”

License to Execute a Business for Used Car Sales in Dubai

You should keep in mind that the registration procedure of your company should be subject to an exclusive license granted by the authorities that supervise the activities of the Dubai Automotive Zone (DAZ). The commercial license is available for one year and must be restored before getting expires within a couple of days.

When you are applying for a commercial license in DAZ, your company documents should be enough. For a successful business in the used car business, we suggest you create a website and present your company and car collection for sale. 

When everything is ready, you can enter the market as a car dealer.

We at Commitbiz have been one of the business consultant players in the UAE region. We provide services for companies and business people interested in establishing their progress in the UAE. 

If you need any further assistance, contact us. We will be glad to help you.

FAQs

Which license is required for vehicle reselling business in Dubai?

You require a commercial license.

Which is the best freezone to start an automotive business?

Dubai Auto Zone (DAZ), Dubai Cars and Automotive Zone (DUCAMS) are a few best freezones for automotive businesses.

How to file VAT online?

You can use FTA’s e-tax portal for VAT returns.

How to start a used car dealership in Dubai?

Register yourself as an authorised dealer with the Road and Transport Authority (RTA) of Dubai.

Is the used car selling business profitable in Dubai?

Yes, having a car has become mandatory in Dubai and the used car business clearly targets a group audience and thus becomes so profitable. 

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