Sales of locally assembled vehicles witnessed a deplorable 52% month-on-month and nearly 80% year-on-year decline in April 2023 as escalating political and economic uncertainty coupled with higher pricing, a reduction in auto finance amid rising interest rates, high fuel prices, plant closures due to part shortages brought on by import restrictions, and delays in the delivery of vehicles to customers continue to take a toll on the auto industry.
Only 4,463 units were collectively sold by PAMA (Pakistan Automobile Manufacturers Association) member companies in April. It was the lowest monthly sales figure since May 2020 Covid-19 lockdowns. Whereas in the first 10 months of the current fiscal year, sales were down by 50% to just 114,868 units compared to 227,995 units sold during the same period of last fiscal year.
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However, there is an interesting thing to come out of this equation— the widening economic divide. While sales of every locally assembled vehicle continue to suffer, those pricier cars with a value exceeding well above Rs 1 crore have witnessed a healthy improvement in sales.
|Vehicles||March 2023||April 2023||MoM Difference|
|Corolla and Yaris||1,119||1,007||-10%|
|Fortuner and Hilux||793||941||19%|
|Civic and City||611||159||-74%|
|HR-V & BR-V||224||48||-79%|
With 941 units sold in April compared to 793 in March, sales of Toyota Hilux and Fortuner witnessed a 19% month-on-month improvement in sales. Whereas the D-segment Hyundai Sonata saloon saw a 31% surge in sales with 155 units sold during April.
Other non-PAMA assemblers are also expected to be facing similar results as Kia which has been generally reluctant to increase the prices of its slowest-selling Sorento recently jacked up its prices along with the Carnival luxury MPV indicating a sizeable demand for these super-expensive vehicles, both of which now cost over Rs 1 crore.
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As the gradient narrows fast, the middle-income group is steadily falling into the low-income group as the rich are getting richer while the poor are getting poorer. Prices of new cars have risen by 35% or more within the last few months, but those rich with wealth continue to select their preferred vehicle—and wait several months for delivery (not to mention that compared to the previous fiscal year, the sales of expensive SUVs and 4x4s have nearly doubled) —while those feeling the pinch of lower purchasing power continue to downgrade a model or two.
A computer animation professional with over 23 years of industry experience having served in leading organizations, TV channels & production facilities in Pakistan. An avid car enthusiast and petrolhead with an affection to deliver quality content to help shape opinions. Formerly written for PakWheels as well as major publications including Dawn. Founder of CarSpiritPK.com