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Car Companies Are Increasing Prices Much More Than Actual Cost of Parts: Analyst

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The recent price hikes from automakers have drawn the attention of many including analysts, who have pointed out a possibility of foul play on the part of the auto industry.

Recently, Ali Khizar — a renowned economic and automotive analyst — shared a few photos from a session convened by the auto parts manufacturers, that discussed the price and material cost trends in Pakistan between 2018 and today.

According to the data, carmakers have increased prices by up to 149%, while the material costs have gone up by up to 90% and the local currency value has diminished by 71%.

Likewise, bike prices have gone up by up to 84%, while material costs have risen by up to 72% with the same local currency depreciation rate.

As per Khizar’s analysis, car prices have risen at a much higher rate than raw material costs. As a result, the competition in the car industry is declining, while the carmakers are drawing unreasonable profit margins by means of “collusion”.

Khizar added that the bike industry is thriving, with better competition among bike and parts makers and a consumer surplus.

The bike industry’s success can be attributed to the fuel and car price hikes, which are likely to continue this year given the volatile economic conditions. This implies more success for the bike industry.

  • lagay rahi munna bhai.. aaloo piyaz aa nahin raha but imports of car parts are not having any issues causing more stress on PKR. As always car mafia is having win-win-win situation.

  • No one have gets to take strict action against the auto companies 🙄, they are all together 😂. Further to this except Pakistan all other countries facilitates their people’s with good quality product and more cheep price.

  • Is there any body from Government side to monitor Prices and Quality of Auto mobiles.
    Companies are increasing prices blindly without any study that purchasing power of a common person has not increased due to this inflation.

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