Auto sales plunge in a slowing economy – Newspaper

KARACHI: Car sales during July and August plummeted a massive 41.3 percent to 20,094 units compared to 34,264 during the corresponding months last year.

In August, total car sales decreased to 9,126 units compared to 15,389 in the same month last year.

Major car assemblers, including Honda Atlas Cars Limited (HACL), reduced production for ten days in July. Similarly, the Indus Motor Company (IMC), during the same month, also closed its plants for eight days in the midst of slow demand due to rising prices, high interest rates, unsold inventory, deceleration of new reserves and the imposition of federal special taxes. in the range of 2.5 percent to 7.5pc in various engine capacities.

In addition, car sales during August remained moderate due to Eidul Azha's vacations, while the interruption of the Suzuki Mehran model also made a dent in total car sales.

According to figures from the Association of Automotive Manufacturers of Pakistan (PAMA), sales of Honda Civic / City experienced the biggest drop to 2,558 units in July and August, of 8,078 units last year, followed by sales of Suzuki Swift, which they fell to 338 units of 839.

Toyota Corolla sales also fell dramatically to 3,708 from 8,770 units.

Suzuki Cultus and WagonR also suffered a major setback with sales of 2,497 and 1,488 units versus 3,041 and 5,222 units in 2MFY18 respectively.

The arrival of Suzuki Alto 660cc, whose sales amounted to 8,019 units in July and August, took away much of the market share of Suzuki WagonR. However, sales of the Alto model decreased to 3,435 units in August from 4,585 units in July.

PAMA figures showed that the last two months also saw a sharp drop in Suzuki Bolan sales to 703 units from 2,559 units.

Truck sales, which were already under pressure since fiscal year 19 due to the slowdown in economic activities, were reduced to 648 units in the two months under review of 1,199 units, while bus sales also decreased to 160 217 units

Sales of light commercial vehicles (LCV), Vans and Jeeps also remained in the red in the last two months. Sales of Toyota Fortuner, Honda BR-V, Suzuki Ravi, Toyota Hilux and JAC fell to 162, 450, 1,162, 716 and 107 units compared to 424, 864, 2,162, 1,292 and 130 units respectively.

Surprisingly, sales of Fiat tractors recovered to 2,426 units of 1,865 while Massey Ferguson sales decreased to 3,166 units compared to 5,986 units.

A BMA Capital analyst, while maintaining a neutral stance in the automotive sector, said the current aggressive decline in car sales may decrease in 2HFY20 and forecasts that the industry will record a 15pc YoY drop in FY20.

Posted on Dawn, September 13, 2019

Source: https://www.dawn.com/news/1504943/auto-sales-plunge-in-a-slowing-economy

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