Tuesday, June 18, 2024

Auto Sales in Pakistan Recorded 98% Growth in March, Sold Over 7000 Units

Karachi: Pakistan’s auto industry saw a growth of 98% to about 7,201 units (passenger cars) in March compared to 3,642 units sold in the previous month, despite the country’s high car prices. This represents a glimmer of hope for the struggling auto industry, which has finally begun to pick up speed after several months.

  • Car sales, however, plunge 68% in March on a year-on-year basis.
  • Monthly increase provides a ray of hope in beleaguered auto sector.
  • 98% growth comes due to better volumetric sales of PSMC, INDU.

Nevertheless, due to non-production days and a drop in purchasing power, car sales—including non-PAMA (Pakistan Automotive Manufacturers Association) vehicles—fell 68% in March compared to 22,799 units in the corresponding month previous year.

Better volumetric sales from Pak Suzuki Motor Company (PSMC) and Indus Motors, which increased by 475 per cent and 6 per cent monthly, respectively, are responsible for the monthly growth.

In addition, Arif Habib Limited said in its remark that buyers shifted to less expensive automobiles with engines under 1000cc, which saw an increase of 423%.

Concerns about a slowdown in the coming months persist because the State Bank of Pakistan’s (SBP) measure to limit imports is still in effect. As a result, auto assemblers must obtain prior authorization to import completely knocked-down (CKD) units and raw materials, which limits their ability to produce.

According to data issued by PAMA a day earlier, sales of all other versions of cars, jeeps, tractors, pick-ups, three-wheelers, and two-wheelers, as well as sales of buses and trucks, decreased year over year in March 2023.

85,776 units were sold in the first nine months of the fiscal year 2022–23, a 50% decrease from the 172,612 units sold in the same time in the previous year. Sales of cars with 1300cc or more were registered at 2,913 units during the review period, a 67% decrease from the 9,280 units sold during the same month the prior year.

Sales of 1,000cc vehicles fell to 964 units in March 2023 (475 Suzuki Cultus and 489 Suzuki WagonR), compared to 2,410 units in the previous month.

  • Data breakdown:

3,324 units of below 1000cc vehicles were sold, which is 70% fewer than the 11,109 units sold the previous year; 2,542 units of Suzuki’s new Alto were sold in March 2023 versus 9,814 units in March 2022;

There were 308 fewer buses and trucks in March than in the corresponding month last year (565 units).

Sales of tractors fell to 2,984 units from 5,651 units in March 2022; sales of jeeps and pick-ups fell to 2,150 units from 4,403 units sold during the same period last year; sales of rickshaws and motorcycles fell to 84,307 units in March from 151,010 units in the same period the previous year.

PSMC recorded a jump of 475% every month to 5,628 units, primarily due to the availability of CKD parts amid an easing of LC issues, while Indus Motors reported an increase of 6% month-on-month to 1,912 units in March.

However, Honda Car (HCAR) sales declined by 49% month-on-month to 835 units in March due closure of the plant for 23 days on account of CKD issues.

  • Performance of other automakers:
  • Sonata sales were down 40% month-over-month to 118 units in the mother under review.
  • Tuscon sales were down 46% month-over-month to 380 units.
  • Hyundai sales were down 34% month-over-month to 34 teams.

In terms of tractors, Millat Tractors reported a 3% month-over-month growth to 2,669 units in March.

Sales at Al-Ghazi Tractors fell from 315 units in the previous month by 57%.

According to Sunny Kumar, an auto analyst at Topline Securities, “This brings the total tractor industry sales to 21,233 units in 9MFY23 down 49% year-on-year owing to floods, plants shut down, weaker consumer buying power, and higher pricing.”

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