KARACHI: Pak Suzuki Motors Company Limited on Tuesday announced to stop operations in compliance with the government efforts to contain spread of coronavirus epidemic.
(more…)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 come down by 44% in eight months
KARACHI: The domestic car sales have declined by 44 percent during first eight months of current fiscal year owing to higher prices and economic slowdown.
According to data released on Wednesday by Pakistan Automotive Manufacturers Association (PAMA), the total car sales declined to 90,834 units during July – February 2019/2020 as compared with 162,240 units in the corresponding period of the last fiscal year.
Market experts attributed the decline to higher car prices and unattractive high interest rate. Besides the slowdown in economy is another major reason.
The sales of Honda Car fell by 61 percent to 12,497 units during first eight months of current fiscal year as compared with 32,077 units in the corresponding period of the last fiscal year.
The sales of Indus Motors fell by 49 percent to 22,707 units during the period under review as compared with 44,409 units in the same period of the last fiscal year.
The sales of Pakistan Suzuki fell by 35 percent to 55,630 units during July – February 2019/2020 as compared with 85,754 units in the corresponding period of the last fiscal year.
Pakistan’s car sales increased by 2 percent MoM in February 2020; led by 12 percent MoM rise in sales of Indus Motor (INDU).
Pak Suzuki Motor (PSMC) and Honda Car (HCAR) both witnessed decline in sales by 3 percent MoM each.
-
Dealers demand reviewing policy for used cars import
KARACHI: Car dealers have said that due to restrictions on import of used vehicles the business of car sales has suffered terribly and many showroom owners have shut down their businesses.
Chairman of Automotive Traders & Importers Association Karachi (ATIAK) Muhammad Kamran Khan and President ATIAK Ch. Aamir Ali Khan have requested the Karachi Chamber of Commerce & Industry (KCCI) to support the car dealers.
They said that due to severe curbs imposed on the imports of used cars particularly the amendment in the Import Policy Order 2016 in which clearance of cars through foreign exchange has been made mandatory, the car sale business has suffered terribly and dozens of car dealers in various localities have shut down their businesses.
They also sought help of the KCCI in getting their parking issue resolved as not a single vehicle belonging either to showroom owners or walk-in customers was being allowed to get parked outside any showroom which terribly affects their businesses.
Chairman ATIAK Muhammad Kamran Khan pointed out that the situation has created a lot of problems not only for the car dealers but also for many other allied businesses including the denting and painting workshops and mechanics etc., rendering thousands of people jobless.
Chairman ATIAK stated that the importers of used cars pay billions of rupees each other in shape of taxes and custom duties but the restrictions on imported cars have brought many businesses on the verge of complete collapse whereas the government was also losing billions of rupees being generated through custom duties and registration of imported vehicles.
“The entire strategy needs to be reviewed and relief has to be provided hence, KCCI, being the premier trade body, must come forward to help out and save car dealers”, he added.
Speaking at a meeting during the visit of ATIAK delegation to KCCI, Chairman and President ATIAK said that relocating showrooms outside Karachi was not a feasible option as not a single customer will come all the way out of city beyond Sohrab Goth to buy cars mainly due to security concerns hence, the relevant authorities will have to come up with some other feasible option in which relief has to be ensured for perturbed showroom owners.
Earlier President KCCI Agha Shahab Ahmed Khan, while welcoming the ATIAK delegation, said that under Businessmen Group’s policy of Public Service, the Karachi Chamber has not only been serving the entire business & industrial community without any discrimination but also all other citizens of Karachi who have been facing hardships and climb the Chamber’s stairs to seek assistance.
He assured the ATIAK delegation members of KCCI’s full support and cooperation so that numerous issues being faced by the car importers and dealers could be resolved as per aspiration of the stakeholders. “We are available for any kind of assistance 24/7 to the entire business and industrial community of Karachi without any discrimination of cast, creed, color or even size of the business”, he added.
Referring to concerns by ATIAK delegates over parking issue, Agha Shahab Ahmed assured that DIG Traffic will be invited so that the parking issue being faced by car dealers could be particularly discussed and resolved.
He was of the view that instead of imposing parking restrictions and creating other problems for showroom owners, the authorities should devise some kind of an effective strategy and come up with a permanent solution in consultation with all stakeholders as the car dealers also contribute billions of rupees every year to the national exchequer in shape of taxes and duties hence, they must get an enabling business environment in return.
Speaking on the occasion, Chairman KCCI’s Special Committee for Small Traders Majeed Memon advised the ATIAK delegates to maintain close liaison with Karachi Chamber, become members of numerous subcommittees and participate in subcommittees’ meetings in order to actively highlight and bring issues to KCCI’s notice so that the same could timely be taken up with relevant authorities and amicably resolved.
-
Finance ministry may resolve taxation issues of automotive industry
KARACHI: A standing committee of the National Assembly has assured that finance ministry to convene an exclusive meeting for resolving taxation issues of automotive industry.
The National Assembly standing committee paid its visit to Pak Suzuki Motors under the chairmanship of Sajid Hussain Turi on Wednesday.
The Committee informed that an exclusive meeting may be convened with FBR, and Ministry of Finance to resolve the problems of Additional Customs Duty, Federal Excise Duty, Additional Sales Tax, shortly.
During the visit the management of Pak Suzuki Motors welcomed the Members and senior officers of GOP, at Suzuki Head office.
The committee witnessed the manufacturing of different vehicles in the plant under the supervision of well experienced team of Pakistani and Japanese Suzuki engineers and workers.
The committee members expressed their well wishes for the Improvement of Pak Suzuki plant which was established in 1992, after visiting the plant.
The Managing Director, Pak Suzuki Motors, Pakistan warmly welcomed the Committee. Shafiq Shaikh, head of Public Relations and official spokesperson briefed the Committee about the historical background of the institution.
He appraised the Committee with regard to different Cars launched by Suzuki Motors time to time in Pakistan, including some imported vehicles and newly introduced cars.
The Managing Director, responded the questions raised by the Members regarding quality of products as compared to imported vehicles, the Committee expressed its satisfaction in this regard.
Shafiq Shaikh explained the causes of increase in prices. He said high mark up rates of Banks loans, over burden of taxation, several additional duties, rupee devaluation, increase in fixed costs / utilities, high trend of inflation and non implementation on Automotive Development Policy(ADP) 2016-21 were the major reason of low production in the automotive sector, which also caused the price fluctuation in the market. Additional Secretary, Ministry of Industries informed that taxation matters were taken up earlier with Ministry of Finance and Revenue but they didn’t respond properly in that regard in last financial year.
The Committee appreciated the role of Pak Suzuki Motors , Management and appreciated Harano, MD and Shaikh for providing the good quality/ standards products in Pakistan and launching of new models of cars and Motorbikes.
Several members along with senior officials from ministry of industries, EDB and PSM attended the meeting.
-
Indus Motors posts 67% decline in half-year profit
KARACHI: Indus Motors Company Limited on Wednesday declared massive 67 percent decline in net profit for six-month period ended December 31, 2019.
According to financial results announced by Indus Motors, the company declared Rs2.3 billion profit after tax for the half year ended December 31, 2019 as compared with Rs6.91 billion in the corresponding half in the preceding year.
The company declared earning per shares of Rs29.32 for the period as compared with EPS of Rs87.94 in the same period of the preceding year.
The company declared gross profit of Rs3.76 billion for six month period, which fell by 62.6 percent when compared with Rs10.05 billion in the corresponding period of the last year.
The expenses of the company increased by 14.28 percent to Rs1.52 billion for half year ended December 31, 2019 as compared with Rs1.33 billion in the same period of the last year.
Revenue from contracts with customers has declined 44 percent to Rs42.77 billion during the period under review as compared with Rs76.44 billion in the corresponding period of the last fiscal year.
Cost of sales also came down to Rs39 billion for the half year ended December 31, 2019 as c compared with Rs66.39 billion in the corresponding half of the last year.
-
Import of used cars plunges by 77% in seven months
KARACHI: The import of used and old cars plunged by 77 percent during first seven months (July-January) of 2019/2020 due to condition of payment of duty and taxes through foreign exchange imposed by the government.
The import of used and old cars in Completely Built Unit (CBU) condition fell by 77 percent to $43.64 million during July – January 2019/2020 as compared with $193.43 million in the corresponding period of the last year, according data released by Pakistan Bureau of Statistics (PBS) on Monday.
The commercial import of used or old cars is not allowed under prevailing laws of the country. However, in order to facilitate expatriate Pakistanis the government allows incentives to bring cars into the country.
The Federal Board of Revenue (FBR) has allowed Pakistani nationals residing abroad including dual nationals can import old and used vehicles into Pakistan under these schemes: Personal Baggage; Gift Scheme; and Transfer of Residence.
The cars not older than three years and other vehicles not older than five years can be imported under these schemes.
In the past these schemes were grossly misused and bulk of imported cars brought into the country.
However, the ministry of commerce in February 2019 amended Import Policy Order, 2016 and made it mandatory for clearance of cars through foreign exchange, which should be certified by banks.
Since then the clearance of the cars has come to a standstill. Customs authorities said that a large number of imported cars were at the port but importer had failed to make payment as per procedure prescribed by the ministry of commerce.
However, in November 2019 Economic Coordination Committee (ECC) decided to allow payment for duty and taxes for customs clearance of imported cars through local resources with condition that if foreign exchange becomes short due to currency fluctuations or change in duty and tax rates.
The overall import of Completely Built Unit (CBU) vehicles during first seven months of current fiscal year fell 71 percent. The import of heavy vehicles including buses and trucks has declined by 59 percent. While import of CBU motorcycles fell by 74 percent.
On the other hand the import of cars as Completely Knocked Down (CKD) condition also fell by 46.46 percent to $261 million during July – January 2019/2020 as compared with $487.6 million in the same period of the last fiscal year.
Industry sources said that massive depreciation in the local currency during past couple of years had increased the cost of local car manufacturers.
Further, the rates of locally assembled cars for end consumers also jumped up sharply.
These factors have reduced the productions of locally manufactured cars and subsequently reduced the import of cars in CKD condition.
The overall import of vehicles in CKD fell by 45.58 percent to $417.2 million during first seven months of 2019/2020 as compared with $766.54 million in the corresponding period of the last fiscal year. -
Car sales decline by 45% in seven months
KARACHI – The car sales in Pakistan witnessed a significant decline during the first seven months (July–January) of the fiscal year 2019–2020, as total sales of locally assembled vehicles fell by 45 percent.
(more…) -
High policy rate stifles economic activity; dwindles profits, job cuts
KARACHI: High policy rate has stifled the economic activity, resulting in dwindled profits and job cuts, this was noted in the financial results of Honda Atlas Cars (Pakistan) Limited for the period of third quarter ended December 2019.
(more…) -
Atlas Honda reports 73% decline in after tax profit
KARACHI: The manufacturer of Honda Cars in Pakistan has reported 73 percent decline in profit for the period (April-December) 2019.
According to financial results of the company shared with Pakistan Stock Exchange (PSX) on Thursday the company declared profit after tax to the tune of Rs710 million during the period as compared with Rs2.68 billion in April – December 2018.
The company also declared loss of Rs41.25 million for the quarter ended October – December 2019 as compared with profit of Rs601.59 million in the same quarter of the last year.
According to financial results for the third quarter ended December 31, 2019, Honda Atlas Cars (Pakistan) Limited reported massive fall of 54 percent in its sales for the period.
The car sales of the company fell to Rs9.86 billion during October – December 2019 as compared with Rs21.29 billion in the corresponding period of the last year.
The domestic car industry is witnessing sharp slumps in sales due to various reasons including significant depreciation of Pak Rupee, increase in prices and high cost of manufacturing.
The gross profit of the company also fell to Rs646.29 million during the quarter under review as compared with Rs1.63 billion in the same period of the last year.
-
Car import plunges by 80% in July-December
KARACHI: The import of motor cars in completely built unit (CBU) condition fell by 80 percent due to deterrence created against misuse of facility.
(more…)