KARACHI: Pakistan’s auto sector saw a significant growth of 98% in March, selling about 7,201 passenger cars, despite the ongoing issue of high car prices.
This growth is a ray of hope for the beleaguered auto sector that has been facing slowdowns for several months. However, car sales, including non-PAMA sales, declined by 68% in March compared to the same month of the previous year due to non-production days and reduced purchasing power.
Volumetric sales of Pak Suzuki Motor Company (PSMC) and Indus Motors contributed to the monthly growth, with PSMC recording a 475% month-on-month increase and Indus Motors recording a 6% increase. Consumers’ shift towards affordable vehicles of below 1000cc due to rising inflationary pressure also played a role, with this category witnessing a growth of 423%.
The State Bank of Pakistan’s measures to curb imports still exist, which limit auto assemblers’ production capabilities. While fears of a slowdown still persist, the growth in March offers hope for the sector’s revival.
In the first nine months of fiscal year 2022-23, a total of 85,776 units were sold, down 50% compared to the same period in FY22. Sales of 1300cc and above cars recorded a decline of 67% compared to the previous year, with only 2,913 units sold in March 2023.
While Suzuki’s new Alto sold 2,542 units in March 2023, compared with 9,814 units in March 2022, sales of 1,000cc cars dropped to 964 units, and sales of buses, trucks, jeeps, pick-ups, tractors, rickshaws, and motorbikes also recorded a year-on-year decline.
PSMC and Indus Motors reported an increase in sales, while Honda Car (HCAR) sales declined due to plant closures. Other automakers like Hyundai, Tuscon, and Sonata also recorded a decline in sales. Tractor sales were also affected, with Al-Ghazi Tractors reporting a decline of 57% month-on-month.
Despite the decline in sales, Millat Tractors recorded an increase of 3% month-on-month to 2,669 units in March