With only 8,312 units finding buyers, sales of new passenger cars in Pakistan during September 2023 dropped by a significant 30.42% compared to the same month of the previous year. However, when compared to the previous month, there was a positive upswing of 8.48%, according to data released by the Pakistan Automotive Manufacturers Association (PAMA).
From August 2023 to September 2023, production numbers also increased by 0.53%, with 6,264 units. Nonetheless, when looking at the big picture, there was a significant drop of 15.33% compared to September 2022.
A total of 16,021 cars were sold during the first three months of fiscal year 2024 (3MFY24), a considerable decrease of 43.93% from the same time the year before. High-interest rates that made it difficult for consumers to finance cars were blamed for this reduction in sales as well as decreased economic activity.
Furthermore, import restrictions affected the influx of CKD parts and materials, leading to temporary plant closures for most assemblers. Unfavorable market conditions also impacted the sales of locally assembled vehicles.
Breaking down the sales categories, cars with engines ‘1300cc and above’ were the most popular, with 2,939 units sold. In the ‘Below 1000cc’ category, the Suzuki Alto emerged as the best seller with 2,551 units sold. however, in the ‘1000cc’ category, only 691 units were sold during September 2023.
According to analysts, while car sales have shown slight improvement last month due to the relaxation of regulations concerning Letters of Credit (LCs) for imports, the long-term scenario remains grim. Escalating car prices, expensive auto financing, and the low purchasing power of consumers are identified as the primary reasons behind the year-on-year sales decline.
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