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Car sales decline by 13% YoY, 4.5% in last eight-month

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KARACHI: Owing to the restriction on the vehicle sales to non-filers in all over the country, Pakistan Auto sales have gone down by 13 per cent year on year (YoY) in February 2019, as against 4.5 per cent YoY decrease in January 2019.

However the sales went down 13 per cent MoM basis which can be attributed to lower number of working days in February compared to January 2019.

The finance ministry through the parliament has approved a bill through which the non-fillers have been allowed to purchase up to 1700cc vehicles in Pakistan. Earlier the government has allowed the non-fillers to purchase only up to 1300cc engine cars.

The Indus Motor Company has also issued a notification today to increase the prices on Toyota Corolla 1.8 and above vehicles, in which it asked the dealers to increase 10 per cent Federal Excise Duty (FED) enhanced by government in the new amended Finance Bill. It would also be applicable on the locally assembled vehicles of above 1700cc vehicles.

“Measures in economic reforms package are expected to support declining volumes,” the analyst of Topline brokerage house said. The volumes will still see a downward trend in months to come due to slow down in economy as well as significant jump in prices of all models in last 15 months, he claimed.

Total sales during first eight months of current fiscal year have come in at 163,000 units, down by 4.5 per cent YoY.

Indus Motors (INDU) reported YoY growth yet again (up 8 per cent YoY in Feb 2019) as the strong (albeit thinning) order book continues to support sales. Fortuner sales rose 80 per cent YoY, first YoY increase in 8 months, while Corolla continued its growth trend with sales up 23 per cent YoY. On the other hand Hilux sales fell 72 per cent YoY, highest YoY decline in 19 months.

Pak Suzuki (PSMC) continued to report YoY decline in sales, down by 17 per cent YoY in February 2019. Sales decline was led by Mehran, Bolan, Swift, Cultus and Ravi variants down by 33 per cent YoY, 18 per cent YoY, 28 per cent YoY, 14 per cent YoY and 14 per cent YoY, respectively.

Wagon-R was the only PSMC variant to record growth YoY (up 16 per cent YoY).

Honda cars (HCAR) sales fell 27 per cent YoY, worst YoY decline since April 2012. This coincides with worst YoY decline in sales of city and civic variants, which fell by 24 per cent YoY. In addition to the economic factors, decline in City and Civic variants can also be attributed to the expected launch of Civic 1.5 Turbo (substitute for Civic 1.8) in coming months.

Simultaneously BR-V sales have declined by 45 per cent YoY.  BR-V sales have fallen YoY for the 10 consecutive months as the variant introduced in April 2017 loses its charm with the consumers.