KARACHI: Sales of domestically manufactured cars in Pakistan have increased by 21 per cent Month on Month (MoM) in October 2022.
Pakistan Automotive Manufacturing Association (PAMA) has released the sales and production data for the month of October 2022, where car sales witnessed an increase of 21 per cent MoM in October 2022 to clocked in at 11,129 units.
READ MORE: Pakistan car sales plunge 50% in 1QFY23
Analysts at Insight Securities said that the rise in sales is mainly due to improved stock levels which led to a partial resumption of production activities.
To highlight, companies were facing higher Non Production Days (NPD) in September 2022 due to import restrictions on CKD parts.
During first four months (July – October) of the fiscal year 2022-2023, cumulative passenger car sales during the period plunged by 47 per cent YoY, to clock in at 39.7k units due to supply constraints and economic slowdown resulting in subdued demand.
READ MORE: Pakistan car sales plummet by 50% on import restriction
Trucks & buses sales declined by 14 per cent MoM to clocked in at 326 units in October 2022. Cumulatively on 4MFY23 basis, truck & buses sales fell by 40 per cent YoY. Jeeps/SUVs and pickups sales soared by 22 per cent MoM to reach at 2.2k units.
Whereas, on 4MFY23 basis, Jeeps/SUVs & pickups are fell by 45 per cent due to aforementioned reasons. Tractors sales went down by 12 per cent MoM due to fragile agriculture demand.
Company wise, PSMC sales improved by 33 per cent MoM in October 2022 primarily due to upbeat demand of hatchback segment driven by better fuel economy and affordability.
Alto remained the top contributor, led by increase in sales of 76 per cent, followed by Cultus and Ravi, up by 50 per cent and 38 per cent, respectively.
READ MORE: Pakistan car sales drop 59% in July 2022
Similarly, INDU sales grew by 29 per cent MoM to clocked in at 3.4k units, compared to ~2.6k units in September 2022. Wherein major contributor are Fortuner & Hilux, up by 84 per cent.
HCAR sales went up by 11 per cent MoM to clocked in at 1.4k units in October 2022 . Wherein major contributors are Civic & City, up by 14 per cent.
Hyundai volumetric sales posted a decline of 50 per cent MoM to clock in at 0.5k units.
MTL volumes witnessed an increase of 2.35x MoM to stand at ~1.5k units whereas AGTL sales declined by 74 Â per cent MoM to clock in at ~0.4k units.
READ MORE: Pakistan car sales surge 54 per cent in FY22
The analysts believe that the automobile industry will remain under pressure on both supply and demand front amid tough business environment, sky-rocketing inflation and higher financing rates further exacerbated by shortage of CKD kits.
Moreover, despite multiple price hikes, gross margins are likely to stay depressed amid continuous pressure on PKR against USD.
Meanwhile, ongoing floods are expected to wipe out 30 per cent-40 per cent of auto demand from rural area. Thus, we have an underweight stance on automobile industry.
