- There is 41% decline in sales in first 8 months of fiscal year.
- Sales climb by 2% month-on-month in February this year.
- Prices, expensive auto financing contribute to decline in sales.
KARACHI: Pakistan’s automotive sector witnessed a sharp contrast in sales as the passenger car sales soared year-on-year in February despite a significant decline in the sales for the fiscal year to date, The News reported Wednesday.
According to latest data by Pakistan Automotive Manufacturers Association (PAMA), car sales saw a significant year-on-year increase of 118% to 7,953 vehicles in February 2024, up from 3,642 units in the same month last year.
However, the increase in sales differentiate with a broader 41% decline in sales over the first eight months of the fiscal year as only 46,417 units were sold in comparison with the 78,575 units during the same period in FY23.
In February 2024, the sales climbed by 2% month-on-month compared with 7,802 units sold in January 2024. The sales of 1300cc and above cars were recorded at 3,941 units in February, up by 39% in the same month last year.
Meanwhile, in February this year, 1,000cc cars recorded sales of 456 units (320 units of Suzuki Cultus and 136 units of Suzuki Wagon R) against 165 units in the same month last year.
The vehicles below 1,000cc recorded a sale 3,556 units, higher by 4.6 times compared with 635 units last year. Suzuki Alto sales surged to 3,373 units on a year-on-year basis in February 2024, compared with 544 units.
Moreover, sales of buses and trucks witnessed a decline to 353 units in the period under discussion from 657 units in the same month last year. Jeeps and pick-ups also saw a decrease to 1,756 units from 2,544 units sold during the same period last year and tractors were sold slightly high — from 3,330 to 3,366 units.
Rickshaws and motorbikes saw a decrease 93,764 units in February compared with 103,003 units in the same period last year.
‘Tax also hurting sales of cars’
Pakistan Association of Automotive Parts and Accessories Manufacturers’ (PAAPAM) former chairman, Mashood Ali Khan, said that sales of vehicles including buses and trucks decreased except for tractors.
“This industry is not going to work unless drastic changes are made in the policy,” he said, adding that the sales of buses and trucks remained low as the industry is not working.
He also said that the sales tax on cars imposed by the caretaker government also affected the sales. “The auto industry’s results are not good. Prices are very high,” he said.
Khan added that there was a need for an industry policy, as the industry has been ignored, which would not be beneficial for the country. “We need to cut down on car prices to increase sales and make a win-win position for the customers, as a common person is not in the position to buy a car because of high inflation,” the auto expert added.
Prices, expensive auto financing affecting sales: Topline
According to brokerage Topline Securities, car sales including non-PAMA members’ car sales clocked in at around 10,900, down by 7% month-on-month while up by 52% year-on-year in February 2024.
The sales by Indus Motors decreased by 26% month-on-month due to the high base effect of last month and the launch of the new Corolla Cross.
Escalating car prices, expensive auto financing, and the low purchasing power of consumers contribute to the decline in sales, said Topline Securities.
