This year has been disappointing for the auto industry with sales continuing to fall and some experts have said that the reasons for the slump are the prevailing economic conditions and the price hikes. On the other hand, the industry claims that the biggest reasons are the government’s efforts towards documenting the economy, especially the condition to become tax filers.
Ali Asghar Jamali, Chief Executive Officer, Indus Motor Company said, “The [sales] outlook for the coming quarter seems promising.”
He added saying,
Last five months were very tough due to rupee depreciation, reduction in auto financing, increase in federal excise duties (FED) and higher input costs, but we are witnessing signs of improvement and, for this reason, non-production days (NDPs) planned in November were canceled.
He did stress that the sector appreciated the efforts being done by the government to widen the tax net but he felt that much had been left to desire as “there should be a way that could lead to a win-win situation; there should be no harm to the industry while people are encouraged to become filers.”
Jamali said that more than half of the car purchases were done by non-filers. He suggested that the government should implement the auto policy fully as it would help the sector in boosting the national economy. The reasoning for this, according to Jamali, is that, “Adhoc decisions create unpredictability and uncertainty which is bad for the industry and investments.” Jamali reasoned, “Make in Pakistan’ approach is needed to boost the economy and the auto sector could play a pivotal role in this regard.”