Monthly Review November 2024

Preface – Economic Climate

The Israeli economy continues to face significant challenges due to the complex security situation and global market conditions. Economic indicators reflect mixed trends: on the one hand, low unemployment and relatively moderate inflation indicate economic resilience; on the other, the high deficit and rising debt-to-GDP ratio underscore the need for cautious fiscal management. The forecast for moderate growth in 2024 emphasizes the importance of growth-supporting policy measures.

The Israeli economy is an advanced economy that participates in the OECD organization. Israel's current GDP per capita is $53,098. Israel's growth rate in 2023 was 2%, while the current forecast for 2024 is 1.5% and 4.2% for 2025.

Israel maintains a 7.7% deficit of the GDP from December 2023 to November 2024.

The debt-to-GDP ratio increased to 62.1% in 2023, and the unemployment rate in November 2024 decreased to 2.7%. As of November 2024, the annual inflation growth rate was 3.4%. In November 2024, the short-term interest rate was 4.5%, while the long-term interest rate stood at 2.21% (October 2024).

Statistical Profile

Society

Population (October 2024): 10.003 Million

Economy

GDP per capita (October 2024): $ 53,098

Inflation (November 2024) (Annual Growth Rate): 3.4% 

Current Account Balance (September 2024): 2.9% of GDP

Trade in Goods and Services (November 2024): $11.945 billion

Finance

US Dollar Exchange rate (November 2024, Avg.): NIS 3.717

Euro Exchange rate (November 2024, Avg.): NIS 3.95

Long-term interest rates (October 2024): 2.21% Per Annum

Short-term interest rates (November 2024): 4.5% Per Annum

Government

Debt to GDP ratio (2023): 62.1%

Deficit to GDP (December 2023 - November 2024): 7.7% 

Motorization

Level of Motorization (2023): 417 Vehicles/1,000 Residence

Innovation and Technology

Gross Domestic Spending on R&D (2022):6.02% of GDP

Environment

CO2 Emissions (2022): 6.2 Tonnes Per Capita

Jobs

Employment Rate (November 2024): 62.7% of the Working Age Population

Official Unemployment Rate (November 2024): 2.7% of the Labour Force

New Cars and CV Registrations

 New Passenger Car Registration: Jan-November 2024

Passenger car registration:  Decrease of 2.4% compared with Jan-Nov 2023.

In November 2024, the Israeli passenger car market registered 18,087 new cars – an increase of 40.2% compared with November 2023. Since the beginning of the year, 258,959 new cars were registered, a decrease of 2.4% compared with last year. Since January, 61,956 BEVs were registered and 5,912 PHEVs, a total of 67,868 cars with chargeable electric drive representing 26.2% of all registrations. The market share of pure EVs in 2024 is currently 23.9%.

New Passenger Cars Registration According to Brands: Jan-November 2024

New CV above 3.5-ton Registration: Jan-November 2024

Commercial Vehicles above 3.5-ton registration: -12% compared with November 2023.

In November 2024, the Israeli market for CV above 3.5 tons registered a decrease of 12% in deliveries with 757 new registrations, compared with 860 units in November 2023. Since the beginning of the year, 12,247 units were delivered, a decrease of 11.2% compared with last year. 

New CV above 3.5-ton Registration According to Brands: Jan-November 2024

New Bus Registration According to Brands: Jan-November 2024

Israel's Auto and Auto-Tech industry

BARAN Group to Establish Battery Swapping Stations for NIO, Reports Globes Financial Newspaper

Thirteen years after Better Place ceased operations, BARAN group will build EV battery swapping stations for NIO. Globes financial newspaper reports that BARAN will install the robotic swapping stations that are produced by NIO. The Chinese auto manufacturer is among the leaders in using this technology and has thousands of stations in China and dozens in Europe, mainly in Norway. In the first phase, BARAN will build three fast swapping stations, in the central region, in Haifa, and the north of Israel. Swapping a battery in these stations takes around 5 minutes.

At the Last Moment: EV Purchasing Tax Increases to 45% Instead of 83%

Less than a month before the purchasing tax on EVs was supposed to increase to 83%, the Miniter of Finance announced that the increase would be much more moderate: from 35% to 45%. However, the “Green tax” benefits given to EVs will decrease and in addition, the annual registration fee for EVs, currently at a flat rate of 530 NIS, will rise significantly. The minister’s late decision caused uncertainty in the auto market in the past few months. Compared with the expected 83%, the moderate purchase tax increase will cost the state 250 million NIS that were supposed to be covered by a new mileage tax. The latter hasn’t been yet legislated so it is possible that the increase in purchasing tax was merely postponed to next year.

Israel and Vietnam Free Trade Agreement Takes Effect

The free-trade agreement between Israel and Vietnam signed in 2023 took effect on  November 17th. For Israel, this is the first free trade agreement with a member of the Association of Southeast Asian Nations (ASEAN), a political and economic union made up of 10 countries, including several that do not have diplomatic ties with Israel. In 2023, trade between the two countries grew by 21%, reaching about $1.3 billion. The agreement is expected to open new opportunities and allow Israeli companies to establish a stronger presence in Vietnam, and vice versa. The Vietnamese economy is a growing one and Vietnam aims to become a major producer of, among other products, EVs and EV batteries that may find their way to the Israeli market.

After 74 Years: Alliance Tire Factory Shuts Down

After more than seven decades in operation, the Alliance tire factory in Hadera, owned by Yokohama, closes its’ gates. The Japanese tire maker announced that it will cease operations at the former Alliance Tire Group (ATG) facility in the face of competition from plants in the Asia region. The factory was established in 1950 by a group of investors in cooperation with Solel Boneh. It later changed hands until 2016 when it was sold to Yokohama rubber. In recent years ATG has specialized in manufacturing and marketing tires for agricultural, industrial, construction, and afforestation machinery.

SaverOne Signs a Commercial Agreement with a Leading Multinational in the Construction Sector

SaverOne (Nasdaq: SVRE, TASE: SVRE), which develops and sells advanced transportation safety solutions, announced that following the press release issued on September 6, 2023, and following the successful completion of a pilot, a commercial agreement was signed with the Spanish subsidiary of a multinational company in the construction sector. Under the agreement, SaverOne will deploy up to 200 SaverOne systems out of the full fleet of 500 vehicles in Spain. The first 100 systems were shipped and will be installed by mid-December 2024. This multinational company is a leader in the construction industry, with operations and fleets in many countries worldwide.