Category: Automotive

PkRevenue provides stories related to automotive industry. We focus on auto policy of Pakistan. The coverage also includes sales of domestic manufacturing.

Car sales register 50% growth in 10MFY22

KARACHI: The sales of domestic manufactured cars have registered a growth of 50 per cent during first ten months (July – April) 2021/2022.

However, auto sales plummeted by 18 per cent Month on Month (MoM) to 22,370 units during April 2022 on the following grounds; increased car prices; and increased cost of financing, analysts at Arif Habib Limited said.

READ MORE: Peshawar Customs auctions motor cars on May 16, 2022

Albeit, the momentum remained positive on a Year on Year (YoY) basis, up 30 per cent mainly on the back of resumption of pre Covid level economic activities along with launch of new models (Swift, Civic, City), consumer’s anticipation of further price hike, given the company’s kept on hinting massive surge in cost of production and substantial Pak Rupee (PKR) depreciation which has put margins under pressure. This took sales during first ten months of current fiscal year to 227,981 units, up 50 per cent YoY.

Engine capacity 1300cc segment and above remained the star performer, up 34 per cent YoY, given resumed sales of new Honda Civic Xi and Swift 4th generation.

READ MORE: Pakistan considers fixing locally assembled car prices

During April 2022, sales in 1000cc segment went up by 29 per cent YoY. Major contributors to it remained Cultus (+33 per cent YoY) followed by Wagon R (+26 per cent YoY).

Sales in below 1000cc segment maintained it’s positive momentum during the month (+22 per cent YoY) because of higher prices of imported small cars, and given this segment is being subjected to relatively lower sales tax (12.5 per cent) and also due to the ability of lower to middle income group to obtain full financing against it.

READ MORE: OICCI suggests duty cut on locally manufactured cars

During April 2022, sales of Indus Motors went up by 8 per cent YoY to 5,775 units. Albeit 18 per cent MoM decline was observed given lower sales of Corolla/Yaris (-24 per cent YoY).

The sales of Pak Suzuki during April 2022 grew by 47 per cent YoY to 12,639 units on the back of resumed sales of new Suzuki Swift 4th generation. Albeit, sales plunged by 16 per cent MoM on the back of increased car prices and consumer’s anticipation of further price hike which caused them to book cars as soon as possible.

READ MORE: Return filing be made mandatory for account holders

Honda Cars sold 2,629 units during April 2022; up by 15 per cent YoY amid launch of new models of Civic and City. Albeit sales declined by 28 per cent MoM amid increased prices.

The sales of tractors stood at 4,848 units during April 2022, (+8 per cent YoY). However, sales went down by 14 per cent on a MoM basis. AGTL posted relatively higher market share (54 per cent) as compared to MTL.

May 12, 2022
Peshawar Customs auctions motor cars on May 16, 2022

PESHAWAR: Collectorate of Customs (Enforcement), Peshawar has announced auction of motor cars to be held on May 16, 2022 at state warehouse godown, Peshawar.

The collectorate announced auction of following motor vehicles:

01. Mercedes Benz (Bullet Proof) Model 1982, Chassis No. WDB-12603312037551

02. Toyota Corolla Car Model 1987 (As per Website), Chassis No. CE90-3002413

03. Toyota Hilux Surf Model 1993 (As per Website), Chassis No. LN130-7044977

READ MORE: Pakistan considers fixing locally assembled car prices

04. Toyota Hilux Surf Model 1991 (As per Website), Chassis No. LN130-0086048

05. Toyota Hilux Surf Model 1992 (As per Website), Chassis No. LN130-7013150

06. Toyota Crown Car Model 2000 (As per Website), Chassis No. GS171-0001109

07. Toyota Hilux Surf Model 1997 (As per Website), Chassis No. LN147-0001826

08. Toyota Hilux Surf Model 1990 (As per Website), Chassis No. LN130-0018395

09. Toyota Hilux Pick Up Model 1993 (As per Website), Chassis No. LN130-7046749

READ MORE: OICCI suggests duty cut on locally manufactured cars

10. Toyota Hilux Surf Model 1993 (As per Website), Chassis No. LN85-0120174

11. Toyota Hilux Surf Model 1990 (As per Website), Chassis No. LN85-0034633

12. Toyota Hilux 4Runner Pickup Model 1996 (As per Website), Chassis No. LN106-0146897

13. Toyota Pick Up S/Cabin Model 1993 (As per Website), Chassis No. LN85-0120634

14. Toyota Corolla Car Model 1994 (As per Website), Chassis No. AE100-3215668

15. Toyota Premio Car Model 2002 (As per Website), Chassis No. ZZT240-0020192

16. Toyota State Car Model 1990 (As per Website), Chassis No. CE96-0106867

17. Toyota State Car Model 1990 (As per Website), Chassis No. CE96-0089577

18. Toyota State Car Model 1988 (As per Website), Chassis No. CE90-0023670

19. Toyota Twoance Model 1990 (As per Website), Chassis No. CR30-5071954

READ MORE: Return filing be made mandatory for account holders

20. Toyota Pick Up Model 1985 (As per Website), Chassis No. LN56-0034679

21. Toyota Pick Up Model 1988 (As per Website), Chassis No. LN51-0013906

22. Toyota State Car Model 1993 (As per Website), Chassis No. CE106-0047961

23. Toyota Corolla Car Model 1987 (As per Website), Chassis No. EE90-5007972

24. Toyota State Car Model 1990 ( As per Website), Chassis No. CE96-0106153

25. Toyota Corolla Car Model 1992 (As per Website), Chassis No. CE100-3025153

26. Toyota Estate Car Model 1997 (As per Website), Chassis No. CE100-0073091

27. Toyota Corolla “X” Car Model 2005 (As per Website), Chassis No. NZE121-0358052

28. Toyota Corolla “G” Car Model 2003 (As per Website), Chassis No. NZE121-3189548

29. Toyota Premio Car Model 2003 (As per Website), Chassis No. NZT240-5007085

READ MORE: Unjustified audit notices annoy taxpayers

30. Toyota Corolla Car Model 1995 (As per Website), Chassis No. CE110-5001735

31. Toyota Rush Jeep Model 2007 (As per Website), Chassis No. J200E-0017143

32. Toyota Fielder “X” Car Model 2002 (As per Website), Chassis No. NZE121-0178782

33. Suzuki Alto Car Model 2005 (As per Website), Chassis No. HA24V-112365

34. Toyota Land Cruiser Model 1991 (as per Website), Chassis No. LJ78-0009228 (Abbotabad)

35. Toyota Corolla Car Model 1973 (As per documents), Chassis No. RT81-053350

36. Mitsubishi Motor Car Model 1982 (As per documents), Chassis No. A171A-8024009

May 11, 2022
Customs auctions confiscated vehicles on May 11, 2022

MULTAN: Directorate of Customs Intelligence and Investigation, Multan has announced auction of confiscated vehicles to be held on May 11, 2022 at Customs Dry Port, near Sher Shah Bypass, Multan.

The announced auction of following vehicles:

READ MORE: Pakistan considers fixing locally assembled car prices

01. Hino Truck HTV, Model 1994, registration no. SBA-775, Chassis No. FF176-18107 (manually punched).

02. Hummer H3 Jeep, Model 2003, registration no. LEE-7444, Chassis No. 5GTDN136768328080.

03. Suzuki Alto Car, Model 2001, registration no. ANR-771 / Sindh, Chassis No. HA12S-610374.

04. Toyota Prius Car, Model 2009, registration no. ZY-442/ISB, Chassis No. ZVW30-1012665.

05. Toyota Mira Car, Model 2009, registration no. AYD-761/Sindh, Chassis No. L275S-0006309.

READ MORE: OICCI suggests duty cut on locally manufactured cars

06. Suzuki Swift Car, Model 2009, registration no. BCU-338/Sindh, Chassis No. ZC71S-477228.

07. Honda Civic Car, Model N/A, registration no. NF-004 / Islamabad, Chassis No. JHMFD46208S202263.

08. Honda Insight Car, Model 2010, registration no. zZ-998 / ICT, Chassis No. ZE2-1201090

09. Suzuki Swift Car, Model 2011, registration no. RE-527/ICT, Chassis No. JSAFZC82S00107384.

10. Toyota Vitz Car, Model 2008, registration no. VC-294. Chassis No. SCP90-5097652.

READ MORE: Return filing be made mandatory for account holders

11. Toyota Corolla Car, Model 2002, registration no. AJX-030/Sindh, Chassis No. NZE121-3201700.

12. Toyota Aqua Hybrid Car, Model 2014, registration no. LEB-17-2328, Chassis No. NHP10-2378804.

13. Toyota Vitz Car, Model 2007, registration no. ADY-910/ICT, Chassis No. SCP90-0036782.

14. Toyota Fielder Car, Model 2004, registration no. VE-112, Chassis No. NZE121-0307673.

15. Toyota Hilux Surf, Model 1994, registration no. WAG-496/Quetta, Chassis No. LN130-7024272.

The directorate said the vehicles may be inspected before two days of the auction date.

READ MORE: Unjustified audit notices annoy taxpayers

May 9, 2022
Pakistan considers fixing locally assembled car prices

ISLAMABAD: The government of Pakistan is considering to fix prices of locally assembled cars in to order discourage abnormal price hike.

According to an official statement on Monday, apropos frequent price hike of locally manufactured and assembled automobiles in past few months.

READ MORE: OICCI suggests duty cut on locally manufactured cars

Spokesperson has expressed concern over price surge and has taken a serious view about the frequent price increases by local automobile manufacturers/ assemblers.

READ MORE: Return filing be made mandatory for account holders

The spokesperson said that the situation was unacceptable, and the government might consider to initiate regulatory measures which may include fixation of prices under the Price Control Prevention of Profiteering and Hoarding Act, 1977.

READ MORE: Unjustified audit notices annoy taxpayers

Furthermore, he said that the cost structure and justification of price increase had been sought from local manufacturers and assemblers.

READ MORE: Foreign investors demand inter-adjustment of tax refunds

May 3, 2022
OICCI suggests duty cut on locally manufactured cars

KARACHI: Overseas Investors Chamber of Commerce and Industry (OICCI) has recommended reduction in federal excise duty (FED) on locally manufactured cars.

The OICCI in its proposals for budget 2022/2023 submitted to the Federal Board of Revenue (FBR), recommended that levy of FED on locally manufactured vehicles should be reduced by amending Serial No. 55B and 55D of Table I of First Schedule of the Federal Excise Act, 2005, to restore sales revenue of vehicles of auto sector while also increasing government revenue.

READ MORE: Return filing be made mandatory for account holders

The reduced FED rates proposed are as follows:

Vehicle Category FED
0 to 1000cc 0%
1001cc to 1350cc 2.5%
1351cc to 2000cc 5%
2001cc and above 7.5%
Double cabin 4X4 pickup 7.5%

It further recommended reduction in minimum tax under section 113 of Income Tax Ordinance, 2001 for authorized dealers of vehicle manufacturers and exemption of withholding tax under section 231B of the Ordinance on sale to dealers.

READ MORE: Unjustified audit notices annoy taxpayers

The rationale is to promote wholesale-retail mechanism, as applicable internationally, which will improve volumes on account of stock availability and healthy competition. Further, contribution to the Government will also increase with increased volume. “Income of dealers will be subject to normal taxation and will promote documentation, thereby increasing tax base.”

The OICCI recommended to reduce minimum tax u/s 113 of the Income Tax Ordinance, 2001, from 1.25 per cent to 0.25 per cent on turnover of authorized dealers of vehicle manufacturers, as being allowed to motorcycle dealers, distributors of FMCG, Pharmaceutical, Fertilizers, etc.;

READ MORE: Foreign investors demand inter-adjustment of tax refunds

Further, withholding income tax u/s 231B should be exempted on sale of vehicles by manufacturers to their authorized dealers to effectively implement wholesale-retail mechanism.

The overseas chamber also highlighted rate of withholding income tax under section 231B of Income Tax Ordinance, 2001.

READ MORE: OICCI presents recommendations to eliminate illicit trade

Amendment shall be made in the categories of vehicles mentioned in Division VII of Part IV of First Schedule as follows:

Engine Capacity (Existing) Engine Capacity (Proposed) Tax
1001cc to 1300cc 1001cc to 1350cc 25,000
1301 cc to 1600cc 1351 cc to 1600cc 50,000

On passenger car with capacity of 1300cc category, different tax rates are applicable based on slight increase in engine capacity (e.g Toyota Corolla (1299cc) was replaced with Toyota Yaris (1329cc). While both vehicles are categorized under broad 1300 cc by market, Rs. 25,000 was collected on Toyota Corolla 1299cc, while Rs. 50,000 is collected on Toyota Yaris 1329cc. Slight increase in cc category is resulting in twice income tax being collected from customer and increasing the cost for customer.

April 17, 2022
Car sales surge by 53% in nine months despite rupee fall

KARACHI: Sales of locally manufactured / assembled motor cars have registered 53 per cent growth during first nine months (July – March) 2021/2022 of the current fiscal year despite massive depreciation in rupee value.

According to data released by Pakistan Auto Manufacturers Association (PAMA), the sales of locally assembled cars increased to 205,469 units during the first nine months of the current fiscal year as compared with 134,718 units in the corresponding months of the last fiscal year.

READ MORE: Investigation into high car prices in Pakistan ordered

The sales of cars grew to 27,131 units in March 2022 as compared with 21,706 units in February 2022 and 20,813 units in March 2021, showing the increase of 25 per cent and 30 per cent, respectively.

Analysts at Arif Habib Limited said that despite the ongoing political turbulence and economic uncertainty, auto sales continued depicting a positive growth.

READ MORE: Pak Suzuki Motor declares Rs2.68 billion annual profit

They further said that despite the upward revision in car prices and rising inflation, car buyers’ interest remained alive, mainly on account of: anticipation of further price hike amid massive rupee devaluation and surge in cost of production, and; greater demand for locally assembled cars given increasing cost of imported CBUs on the back of higher freight costs and commodity prices (especially steel), substantial currency depreciation, and imposition of temporary loan ban on financing of imported CBUs.

READ MORE: Rupee makes recovery to dollar for third straight day

According to data, the sale of cars below 1000 CC surged by 83 per cent to 53,241 units during first nine months of the current fiscal year as compared with 29,038 units in the same months of the last fiscal year.

The sales of cars with engine capacity up to 1000CC posted a growth of 65 per cent to 34,602 units during the period under review as compared with 20,975 units in the same period of the last fiscal year.

Meanwhile, sales of 1300CC and above recorded an increase of 35 per cent to 75,207 units as compared with 55,733 units in the corresponding period of the last fiscal year.

READ MORE: Indus Motors estimates 15% sales dip on PKR fall

The sales of Indus Motors increased by 33 per cent to 55,567 units during first nine months of the current fiscal year as compared with 42,670 units in the corresponding months of the last fiscal year.

The sales of Pak Suzuki posted 66 per cent growth to 109,419 units during July – March 2021/2022 as compared with 66,013 units in the same period of the last fiscal year.

Similarly, the sale of Honda Cars recorded 38 per cent to 30,010 units during first nine months of the current fiscal year as compared with 21,698 units in the same period of the last fiscal year.

April 12, 2022
Investigation into high car prices in Pakistan ordered

ISLAMABAD: A monitoring committee for automobile industry has directed investigation into massive increase in prices of motor cars in Pakistan during past few months.

The meeting of monitoring committee for automobile industry met under the chairmanship of Federal Secretary for Industries and Production, Jawad Malik this afternoon.

READ MORE: Pak Suzuki Motor declares Rs2.68 billion annual profit

Meeting was attended by representatives from automakers, Pakistan association of automotive parts and accessories manufacturer (PAAPAM), Engineering Development Board(EDB), Federal Board of Revenue (FBR), State Bank of Pakistan (SBP), Competition Commission of Pakistan (CCP) and Ministry of Science & Technology.

The forum sought factors and justification for recent price hike in different models of cars across the board.

READ MORE: Rupee continues falling spree; dollar at Rs183.48

The meeting was told that recent price hike is due to Dollar Rate (USD to PKR), increase in freight charges and raw materials including operational cost.

The industry also provided details on causes of late delivery, CDK imports and production capacity.

The monitoring committee expressed concerns over massive price hike in past 5-6 months and safety features in automobiles.

READ MORE: Indus Motors estimates 15% sales dip on PKR fall

After due deliberations, the Chair directed to carry out forensic analysis of car prices in comparison with factors indicated by the industry as a reason for price change through independent professional expertise.

The secretary instructed to complete the forensic analysis within two weeks.

The chair also asked the automotive industry to provide localisation plan with time frame as well as safety features compliance report to the ministry.

READ MORE: Pakistan’s car sales surge 56% in eight months of FY22

March 31, 2022
Pak Suzuki Motor declares Rs2.68 billion annual profit

KARACHI: Pak Suzuki Motor Company Limited (PSMC) on Tuesday announced net profit of Rs2.68 billion for the year ended December 31, 2021.

The company had declared a loss of Rs1.38 billion during the previous year, according to financial statement shared with the Pakistan Stock Exchange (PSX).

Analysts at Arif Habib Limited attributed the massive surge in profit to improved volumetric sales which is 108 per cent year on year (YoY), increased car prices, higher other income as well as reduction in financial charges, given significant decline in borrowings.

READ MORE: Pak Suzuki posts sharp 285pc growth in first quarter

Alongside the result, the company also announced a final cash dividend of Rs6.50/share.

The highlights of the financial results of PSMC revealed that during the fourth quarter (October – December) 2021 the net sales surged by 64 per cent YoY to Rs43.71 billion owing to significant jump in sales volume, which is 68 per cent year on year, together with upward revision in prices. This took financial year 2021’s topline to Rs160.08 billion up by 109 per cent YoY.

READ MORE: Meezan Bank, Suzuki Motors sign MoU for car financing

During the fourth quarter, the gross margins declined to 3.55 per cent as compared to 9.28 per cent or decline of 573 basis points in same period last year (SPLY) amid higher cost pressures emanating from substantial currency devaluation, around 4 to 5 times jump in freight costs, coupled with elevated input costs (mainly steel).

READ MORE: TPL, Pak Suzuki sign agreement for auto insurance

The same reasons kept the margins lower as compared to the last quarter or decline by 175 basis points. Together with this, swift’s production decline, mainly to pave way for the product’s new model, contributed further towards the suppressed margins on a quarter on quarter (QoQ) basis. This took calendar year 2021’s margins to 5.1 per cent compared to last year’s margins of 4.69 per cent, as augmented topline offset the impact of rising cost pressures.

READ MORE: Pak Suzuki declares half year loss of Rs2.46 billion

During the quarter, other income increased by 142 per cent YoY and 121 per cent QoQ to Rs933 million on the back of increased advances from customers, which generated higher interest income for the company. Similar trend was witnessed in calendar year ended December 31, 2021.

During the year under review, the company booked effective taxation at 29 per cent.

March 23, 2022
Indus Motors estimates 15% sales dip on PKR fall

KARACHI: Indus Motors Company Limited has estimated up to 15 per cent decline in car sales this year due to massive depreciation in Pakistan Rupee (PKR) value.

In a corporate briefing on Thursday, the Indus Motors informed that this year’s sales volumes remained impressive however, the company anticipates demand to receive a hit during 2022/2023 as an outcome of elevated interest rates, stringent auto financing conditions together with bloated Current Account Deficit; which will further exert pressure on exchange rate.

READ MORE: Pakistan’s car sales surge 56% in eight months of FY22

“Due to aforementioned reasons, the management is estimating sales volumes to take a dip of around 10-15 per cent. As a response to this, the company is currently operating on lower volumes,” according to analyst at Arif Habib Limited.

Management deemed upcoming year to be tough for automotive industry. It expects cost pressure to continue going forward, mainly on the back of 4 to 5 times increase in freight costs during the year together with elevated commodity prices, increased FED/sales tax and currency depreciation.

READ MORE: Pakistan’s car sales surge 61% in 7MFY22

Together with this, the management expects delay in shipments and material shortages to keep the sales volume and profitability subdued.

Highlighting the company’s financial performance management mentioned that during first half of the current fiscal year, the company’s sales volume increased by 47 per cent YoY to 38,632 units as compared to 26,362 units in same period last year (SPLY).

READ MORE: Pakistan’s car sales up monthly highest ahead price hike

During 1HFY22, sales revenue surged by 70 per cent YoY to PKR 135.2bn as compared to PKR 79.6bn in SPLY amid higher volumetric growth whilst the profit after tax increased to PKR 10,175mn (EPS: PKR 129.45), up 112 per cent YoY from PKR 4,801mn (EPS: PKR 61.08) during SPLY. The growth in profitability is an outcome of higher CKD and CBU sales together with higher other income, given higher return on investments.

On a sequential basis, company’s profitability took a dip as an outcome of rising input cost, given substantial currency devaluation, and surging commodity prices.

READ MORE: New rates of FED on local, imported motor vehicles

While responding to the Q&A session, the management highlighted that the decline in sales volume during the month of Feb’ 22 was due to; i) production halts given the plant was shut down for one week for maintenance work and, ii) underutilization of plant capacity amid fewer working days during the month.

The management hinted price hike of around 11-12 per cent, but not until June 2022.

The management highlighted that the current month’s orders are booked up till June 2022 and that booking orders are hovering in between 4-4.5 months.

March 17, 2022
CarFirst, Habib Metro Bank sign deal for fleet vehicles

KARACHI: CarFirst, a car trading platform in Pakistan, has signed a Memorandum of Understanding (MoU) with Habib Metro Bank for disposal of used vehicles.

The MoU was signed at CarFirst’s regional office in Karachi to trade the fleet vehicles under HABIBMETRO’s ijarah financing option.

READ MORE: Customs to auction confiscated vehicles on March 24

Under this arrangement, CarFirst will be offering inspection and evaluation services of the fleet vehicles of HABIBMETRO Bank.

Carfirst and HABIBMETRO’s collaboration aims to mutually benefit both parties with a transparent and hassle-free car trading service. CarFirst will purchase cars owned by HABIBMETRO at the discretion of both parties.

READ MORE: Quetta Customs I&I to auction motor cars on March 17

CarFirst is catering to the rising demand of the used cars market by providing efficient solutions to individual customers and corporations to sell cars.

By entering strategic partnerships with leading financial institutions like HABIBMETRO, CarFirst aims to meet the needs of potential sellers in the best possible way.

Commenting on this collaboration with HABIBMETRO, Shahbaz Saeed, Head of Marketing at CarFirst, said: “CarFirst is driven towards simplifying the lives of its customers and continuously pushing Pakistan’s used car industry forward through innovative solutions and progressive partnerships.

“This new joint venture is likely to prove fruitful for both Carfirst and HABIBMETRO in terms of an effective and seamless disposal solution of the corporate fleet.”

Salman Ali, Head of Consumer Partnerships at HABIBMETRO, said, “We look forward to strengthening our partnership with CarFirst in the future.”

March 16, 2022