In the past few months, car sales have been decreasing with sales in July and August plunging by 41.3% from 20,094 units from 34,264 units last year. In August alone totals car sales fell to 9,126 units compared to 15,389 units in August last year.
The fall in sales has been put to multiple factors including the increase in prices, high interest rates, inventory going unsold, decrease in fresh booking and implementation of federal excise duty ranging from 2.5%-7.5%. This has led to major local carmakers, including Honda Atlas Cars Limited (HACL) and Indus Motor Company (IMC), to shut down their plants for 8-10 days a month.
Furthermore, due to Eidul Azha holidays in August, the car sales remained stagnant along with Suzuki pulling the plug on Mehran impacted the overall car sales.
The information released by Pakistan Automotive Manufacturers Association (PAMA), and Topline Securities can be seen in the table below:
|Pakistan Car Sales Numbers|
Honda Civic/City sales saw the biggest decline from 8,078 units last year to 2,558 units in July and August, while Suzuki Swift was at 2nd as sales fell to just to 338 units from 839 units. Toyota Corolla also saw its sales drop from 8,770 units to 3,708 units.
The Suzuki Cultus and WagonR too saw sales drop to 2,497 and 1,488 units respectively as compared to 3,041 and 5,222 units in the same period last year. Interestingly, Suzuki Alto 660CC took away a major chunk of WagonR’s market share with 8,019 units in July-August.
An analyst at BMA Capital said that it is likely that the sustained decline in sales may sallow down in 2HFY20 and projected that the industry would only see a drop of 15 percent YoY in FY20.