Sales of locally assembled cars down 38 percent YoY in December

The sales of locally assembled cars have witnessed 38 percent YoY decline in December, 2019.

According to details, a YoY basis, weak demand dynamics was again evident from a 38% YoY fall in sales in Dec-2019, taking 1HFY20 decline to 44% YoY. This is primarily attributable to 1) higher car prices mainly due to PKR devaluation and 2) higher interest rates.

However, the cars sales jumped by 23% MoM to 12.1k units in Dec-2019, which was largely led by 49% MoM increase in sales of Pak Suzuki Motor Company (PSMC).

The other two major manufacturers, Indus Motor (INDU) and Honda Car (HCAR) sales dropped by 12% MoM and 23% MoM, respectively.

The increase in sales of the PSMC was largely driven by the announcement of increase in car prices by the manufacturer in mid of Dec-2019, which was effective from Jan 1, 2020. The decline reported by the other manufacturers was largely in line with the historical year-end phenomenon, where consumers generally delay their purchases until new-year.

PSMC sales were down 26% YoY in Dec-2019, while INDU's sales declined by 56% YoY with Corolla sales falling by 50% YoY. HCAR sales fell by 58% YoY during Dec-2019 with combined sales of City & Civic declining by 56% YoY. The sale of motorcycles by Atlas Honda (ATLH) witnessed an increase of 6% YoY as sales clocked in at 85k units, however it recorded a decline of 11% MoM. Tractor sales recorded a growth of 75% YoY with Millat Tractor (MTL) sales rising by 175% YoY. On the MoM basis, overall tractor sales were down 37% MoM.