Pakistan’s auto industry is going to face ‘a tough year’ in 2018 due to the rising prices, not only for new cars but also used ones.
It all began with Toyota and Pak Suzuki — the auto mafia in Pakistan — increasing the prices of their new cars. Following in their footsteps, FAW also did the same.
Now, market analysts are claiming that used car prices are also going to rise, which will cause a huge commotion in the industry.
IMC Increases Toyota Corolla Prices Due To Rupee Devaluation
These claims do carry some weight because we all know that Rupee’s value is decreasing against Dollar, oil prices are surging, sales tax on new cars has been increased, and prices of other household items have been sky-rocketing with the arrival of 2018.
It is, therefore, a great possibility that prices of local and imported second-hand vehicles might increase as well.
New SRO on Imported Vehicles
Secondly, the government issued a new SRO, namely 1067(1)2017, in a bid to tackle the loopholes in used cars’ import policies. Under this new SRO, it would not be easy to import vehicles — which will automatically increase the prices. The recently applied additional taxes on imported vehicles also do not help in this case.
The car import prices will also be affected by the devaluation of the local currency against the Dollar — which currently stands at Rs 110.
Turtle’s Pace of Local Automakers
The local automakers are making the matter worse for the auto buyers due to their incredibly slow car manufacturing and assembling pace. The used car market takes an advantage of this fuss and people are forced to buy “second-hand” cars on high prices.
On the other hand, the government claims that it has issued the SRO just to control shortfall in trade, not to harm the import of cars.
We just have to wait and see how events unfold for auto industry this year.
What’s your say on the matter. Are price increases justified?
great post muazzam, i sure would love to see more of such from your end regarding used car prices in pakistan. thank you