November proved to be no better for local auto assemblers that have been facing a tough time lately. Sales for the sector dropped to a 17-month low, according to figures released by Pakistan Automotive Manufacturers Association (PAMA). During 5MFY13, car sales (including LCVs, Vans and Jeeps) plummeted 31 percent, compared to the previous year to 49,092 units.
Reportedly, during the five-month period under consideration, industry losses surpassed Rs15 billion as a result of low sales volume. Industry insiders attribute the thin sales to the influx of over 25,000 used imported cars during 5MFY13. Moreover, the phasing out of the Punjab Government Taxi Scheme also erased demand. Last year, an additional 20,000 units of Suzuki Mehran and Suzuki Bolan were sold in lieu of Punjab Yellow cab taxi scheme.
Besides the termination of non- Euro II compliant models such as Alto and Cuore has taken out the low cost options that were earlier available for cost-conscious buyers. During 5MFY12, the accumulated sales of both variants were 7,700 units which tapered to 71 units in 5MFY13.
In November alone, the auto industry sold 8,216 units, illustrating a year-on-year slump of 22 percent. However, the industry sources highlight that the decline seen in November mainly comes on the heels of New Year registration trend. Since new models for Toyota Corolla, Honda Civic and Honda City have been rolled out, car sales are likely to pick up a notch from January.
Indus Motors sales plunged by 37 percent YoY to tally 13,128 units in 5MFY13. The slump in sales is due to 38 percent YoY decline in Corolla sales to 11,047 units in 5MFY13.
PSMC sold 28,337 units during 5MFY13, down 34 percent as compared to 42,738 units sold last year. This is mainly attributable to the conclusion of Taxi Scheme.
Unlike the other two players, sales of Honda Atlas cars recoiled to 7,429 units; a YoY growth of nine percent. Informed sources underscore that the superior sales of Civic which totalled 3,133 during 5MFY13 contributed to this bounce off. The sales growth is also attributable to low sales last year after floods in Thailand disrupted supplies.
Going forward, the recent decision by ECC to limit the age of used cars from five years to three years may buttress local car sales. Relatively lower interest rates may also provide some impetus for sales supported by financing from banks.
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SALES DATA
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5MFY13 5MFY12
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CARS 62,353 43,206
TRACTORS 11,894 19,851
TRUCKS & BUSES 835 873
JEEPS 257 189
PICK-UPS 8,117 5,697
MOTOR CYCLE & THREE WHEELERS 345,624 359,452
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Source: PAMA
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