The auto-sector of Pakistan is the prime example of stringent economic policies and an overall halting economy as sales took a nosedive with a 42% plunge in units sold in July 2019 when compared to July 2018 as only 12,482 units were sold in the former compared to 21,344.
According to experts, there are multiple reasons for this including the sustained rise in car prices in the last year alone, the implementation of the federal excise duty in the budget for the current fiscal year and increase in fuel cost.
The downward trend was across the board with all three companies; Honda, Suzuki and Toyota performing poorly. Honda Atlas Cars saw a staggering 66% plunge on a year-on-year basis. Indus motor saw the biggest year-on-year fall in sales in the past five years according to a Topline Securities’ report.
It added, “The significant attrition in volumes is mainly due to 57% year-on-year decline in sales of its Corolla variant, which is generally considered high in demand.”
|Number of Units sold by each Company|
|Three Wheelers and Motorbikes|
|Trucks and Buses|
Here is the breakdown of units sold by each company with regards to each model:
|Number of models sold by each Company|
|Honda (Civic & City)||1,452||4,609||-68%||2,106||-31%|
Things are equally bad on the production side as there was a 16.19% drop in the production of light commercial vehicles (LCVs) during the first eleven months of the financial year 2018-2019 as compared to the production during the same period of the financial year before.
The data released by the Pakistan Bureau of Statistics (PBS), shows that during July-May 2018-2019 over 22,777 LCVs were manufactured while in July-May 2017-2018 around 27,178 units were produced.
In this same timeframe, the manufacturing of cars and jeeps fell by 5.32%, from 214,904 units last year to 203,474 units.
Motorcycles also saw their production fall by 12.52%, from 2,606,326 units last year to 2,279,925 units. Likewise, there was a 32.43% fall in the production of trucks to 5,773 units from 8,544 units and tractors saw their production drop from 67,371 units to 46,344 units – a 31.21% decrease.
Interestingly, buses saw their production rise by 16.11% in this timeframe as it jumped to 829 units from 714 units. The production of LCVs fell by 35.81% on a year-on-year basis to 1,323 units in May 2019 from 2,061 units in May 2018.
As per data, the production of jeeps and cars decreased by 31.09%, from 18,227 units in May 2018 to 12,561 in May 2019, while the manufacturing of motorcycles fell by 18.63%, from 250,508 units to 203,826 units.
Tractors also saw their production plunge by 53.22% falling from 6,870 units in May 2018 to 3,214 units in May 2019. While trucks also fell from 808 units in May 2018 to 335 units in May 2019 but the manufacturing of buses rose by 42.42%, from 66 units to 94 units.
It is important to point out that the overall production of large scale manufacturing industries (LSMI) during the first 11 months of FY19 fell by 3.5% as compared to the same period of last year.
On a year-on-year basis, the LSMI production fell by 3.78% during the month of May 2019 as compared to May 2018. On a month-on-month basis, it plunged by 7.97% when compared with April 2019.