Car sales surge by 58% in September 2021

Car sales surge by 58% in September 2021

KARACHI: The sales of locally assembled / manufactured cars witnessed a growth of 58 per cent in September 2021 due to lower tax rates and rise in auto financing.

According to data released by Pakistan Auto Manufacturers Association (PAMA), the automobile industry saw an increase of 58 per cent in vehicle sales to 22,079 units during September 2021 against 13,982 units in September 2020.

This increase can be attributable to low prices of cars post the reduction of taxes, and increased auto-financing, said analysts at KASB Securities.

Moreover, car sales likely witnessed a push in anticipation of additional price hikes in view of the recent current depreciation. On a sequential basis, the sales remained static at around 2 per cent increase on MoM basis.

Pak Suzuki witnessed a 7 per cent MoM decline in sales owing to discontinuation of Swift, while Alto, Bolan and Ravi also suffered a decrease in sales owing to delayed delivery time.

On a cumulative basis, Alto, Cultus, WagonR and Ravi reported a strong increase in sales because of improved economic activity and lower rates. As a result Pak Suzuki managed to report a 120 per cent increase in sales for 3MFY22.

Indus Motor witnessed a 44 per cent YoY (12 per cent MoM) increase as Fortuner sales were up by almost 5x while Yaris and Corolla monthly sales also increased. Cumulative sales for 3MFY22 stood at 18,646 units (up by 59 per cent YoY).

Honda Atlas Car saw its City/Civic sales unit climbing above 3k mark (+24 per cent MoM) as newly launched 6th generation model of City were delivered, registering around 34 per cent YoY growth for the company. On a cumulative basis 3MFY22 units stood at 9,172 units, a rise of 23 per cent YoY.

Hyundai saw a 69 per cent increase in sale of Tucson as monthly sales reached 325 units. Sonata proved to be a successful launch in the market as its sales increased by 35 per cent MoM.

The sale of trucks and buses were down by 16 per cent and 18 per cent respectively while tractor sales were up by 32 per cent because of increased focus on agriculture.

Going forward, the recent stringent changes in auto-financing regulations by SBP alongside supply chain disruptions due to global chip shortages are likely to slow down auto sales demand in the upcoming quarters.

Inevitable price hikes due to currency devaluation and surge in international steel prices will be another factor adversely affecting Auto sales demand.