Local Assemblers Have Rs189 Billion as Advance Payments

As Pakistan is experiencing economic crisis scenario, local car industry seems is going through a turbulent period with devaluation of rupees against the US dollar, economic instability, non-issuance of Letter of Credit (LC) by State Bank of Pakistan (SBP) and political uncertainty among others.

Related: Auto Sector’s Woes Continue as More Assemblers to Observe NPDs

With no CKD kits in hand, the companies are suspending the bookings, halting their production to observe non-production days, that will result in further delays in deliveries, while still announcing massive price increases which will be applicable on new orders once the production (assembling) resumes.

TDM Showroom

Recently, the local auto industry was the focus of discussion during Public Accounts Committee (PAC) meeting. During the discussion, the PAC was informed that Rs. 189 billion have been deposited by customers as advance payment to 10 car companies.

Related: CKD/ SKD Imports Hit Record $1.7 Billion in FY22

Breakdown of Rs 189 Billion Advance Payments made to Local Automakers

  • Indus Motors Company (Toyota) – Rs 99.2 billion
  • Pak Suzuki Motors Company Ltd – Rs  35.4 billion
  • Honda Atlas Cars – Rs 21.8 billion
  • Master Changan Motors – Rs 11 billion
  • Kia Lucky Motors – Rs 10.6 billion
  • Hyundai Nishat Motors – Rs 6.9 billion
  • Al-Haj Automotive (Proton) – Rs 1.7 billion
  • Ghandara Nissan Limited (GNL/ Chery) – Rs 1.6 billion
  • Sazgar Engineering Works Limited (Haval/ BAIC) – Rs 0.7 billion
  • Regal Automobiles (DFSK/ Prince) – Rs 0.3 billion

PAC was also told by an automaker that government had asked the assemblers if they could not deliver the vehicles on time, then why are they taking a huge number of bookings from the customers.

Related: Woeful Delivery Periods of Local Assembled Cars in 2022

Even before the import restrictions were imposed by the State Bank, the delivery periods of local assembled cars ranged between 3 to up to 14 months depending on the model & assembler. However with such huge amount of money collected in the name of advanced bookings, the assemblers must streamline their operations and ensure they have enough supply to timely deliver the vehicles to the customers. Sparing the Big-3, the annual production of most of the players is below 25,000 units which should be elevated to meet the demand.

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