Senate standing committee on industries and production once again expressed concern over the unchecked car price hikes in Pakistan. A meeting of senate standing committee at parliament house held a discussion on this issue. Senators highlighted the issues associated with the nation’s rising automobile prices.
They claimed that automakers are increasing vehicle prices by using currency depreciation as an excuse. They claimed that the automakers have a monopoly in the country.
The committee discussed the rationalization of the automobile industry as well as the possibility of fixing car prices. It also emphasized on the regulation of steel and iron scrap prices.
The committee members brought up the ‘own money’ and the lengthy delivery delays. They alleged that the delays are part of a deliberate scheme to charge more ‘own money’ from buyers.
The committee members claimed that the delivery of a reserved vehicle takes eight to nine months. The chairperson requested the Ministry of Industries and Production (MoIP) to address the vehicle delivery delay and ‘own-money’ issues.
The Blame Game Continues
On the other hand, car companies are blaming the government and its policies for the ongoing situation.
This year, car companies have announced multiple production cuts due to non-approval of the letter of credit (LC) needed for clearance of completely knocked down (CKD) car assembly kit imports.
The automakers claimed that the non-approval of LCs from the State Bank of Pakistan (SBP) stalled operations and caused delivery delays. Also, the car financing sanctions by SBP have hampered car sales.
Furthermore, carmakers are blaming the local currency depreciation for the price hikes. They state that, while the logistics costs and material costs have also shot up, Rupee devaluation is the main contributing factor to the price hikes.
Automakers reckon that the situation will worsen in the coming days if these factors prevail.