Toyota Corolla and Yaris have experienced a noticeable setback as their sales plummeted by 10 per cent in April 2023 when compared to the preceding month of March.
According to analyst at Arif Habib Limited, the sales of Corolla and Yaris declined by 10 per cent in MoM (month-on-month) and 64 per cent YoY (year-on-year). Indus Motor Company (IMC) sold a total of 1,007 units in April, reflecting a decline from the 1,119 units sold in March.
The reduced sales has raised concerns within the automotive industry and warrants an examination of the contributing factors. Analysts attribute this significant drop in demand to the prevailing high interest rates and the escalating prices of automobiles across the country.
The steep increase in interest rates has made financing vehicle purchases more expensive for consumers. Higher borrowing costs have deterred potential buyers, causing them to rethink their plans or delay their car purchases.
Additionally, the escalating prices of automobiles have also played a significant role in the decline. The rising costs of raw materials and other production inputs have prompted manufacturers to raise the prices of their vehicles, making them less affordable for consumers. This, in turn, has dampened the demand for vehicles, including popular models like the Corolla and Yaris.
READ MORE: Pakistan’s domestic car sales reach three-year low in April 2023
The automotive industry in Pakistan has faced additional challenges, such as frequent plant shutdowns due to supply chain disruptions and production constraints. These interruptions have further impacted the availability of vehicles in the market, leading to reduced sales.
Another factor contributing to the current condition of the automotive industry is the rise in petroleum prices. With fuel costs on the upswing, consumers have become more cautious about their transportation expenses, which has affected their purchasing decisions regarding cars.
Collectively, these challenges have resulted in reduced affordability for consumers and a contraction in the automotive market. As a result, manufacturers, including the Indus Motor Company, are facing the need to recalibrate their strategies to adapt to the current conditions.
READ MORE: Latest prices of Toyota Corolla variants in Pakistan