Car sales in Pakistan saw a massive decline in September amid high prices and interest rates.
The Pakistan Automotive Manufacturers Association (PAMA) has reported that car sales in September 2023 amounted to 6,410 units, a decrease from the 9,213 units sold in the same month the previous year. However, there was an 8% increase in sales in September compared to August, attributed to the removal of import restrictions.
For the first quarter of the fiscal year 2023/24, passenger car sales experienced a substantial drop of 44%, with only 16,021 units sold compared to 28,571 units in the same period last year.
Sales of cars with engine capacities of 1,300cc and above saw a decline of 38%, totaling 2,939 units, down from 4,715 units sold in the previous year. Nevertheless, this category showed a 27% increase compared to the 2,310 units sold in August.
In September, 691 units of 1,000cc cars were sold, a decrease from the 1,517 units sold during the same month in the previous year. Vehicles with engine capacities below 1,000cc recorded sales of 2,780 units, marking a 7% decline from the 2,981 units sold the previous year. This category also saw a decrease in sales compared to August when 2,935 units were sold.
The sale of buses and trucks reached 185 units in September 2023, down from the 378 units sold in the same month the previous year, although there was an increase compared to the 167 units sold in August.
Conversely, the sale of jeeps and pick-up trucks decreased from 2,075 units sold during the same period last year to 1,902 units. However, this category, like others, experienced a month-on-month increase. Sales of tractors increased significantly to 5,445 units, up from 2,149 units sold in September the previous year.
Sales of rickshaws and motorbikes increased, with 107,084 units sold in September 2023, compared to 99,581 units in the same period the previous year.
Sunny Kumar, an analyst at Topline Securities, attributed the monthly increase in car sales to the easing of import restrictions for completely knocked down (CKD) kits, which car manufacturers use for car assembly.
However, he noted that rising car prices, expensive auto financing, and low consumer purchasing power were the primary factors contributing to the year-on-year decline in sales.
Among car manufacturers, Honda Atlas Car (HCAR) recorded the highest month-on-month increase of 99%, with 1,342 units sold in September 2023. This significant increase was primarily due to the low sales base the company had in the previous month when it sold only 674 units.
Pak Suzuki (PSMC) was the only manufacturer to record a 1% month-on-month decline, with 4,234 units sold in September 2023. This decline was led by an 8% month-on-month drop in Alto sales. Other variants, including Ravi, Bolan, and Cultus, recorded month-on-month increases of 58%, 38%, and 9%, respectively. Swift and Wagon-R sales remained flat month-on-month, with 506 and 359 units sold in September 2023.
