Pak Suzuki jacks up car prices for the third time this year

KARACHI: Pak Suzuki Motor Company Limited (PSMCL) on Friday jacked up the prices of all its automobile variants, bringing the cumulative increase to Rs50,000 to Rs80,000 per unit since January 2018.

This is the third increase in the prices of vehicles by the Japanese automaker that shares sheer dominance in the passenger car segment with Honda and Toyota, during the current calendar year. Analysts reckon the weakening rupee may be one of the reason behind this increase as the company had blown up the prices in January and March this year following rupee’s depreciation.

The PSMCL, in its communication to the authorised dealers, notified the new prices would be effective from June 1, 2018.

This time around the price of Mehran VX variant has been increased by Rs30,000 to Rs739,000, but it has gone up by Rs50,000 since the beginning of this year. The price of Mehran VXR, increased by Rs33,000 to Rs795,000, has jumpped Rs53000 per unit since the first month of the year.

Cultus VXR, which has gone up by Rs30,000 to Rs1,300,000, has become dearer by Rs50,000 since January. While variants of Swift DLX and Swift DX registered an increase Rs60,000 each to reach Rs1,435,000 and Rs1,571,000 respectively, since January 2018. Moreover, the price of Wagon R VXL rose by Rs80,000 to Rs1,194,000 from January 2018.

Commenting on this increase, H M Shehzad, chairman All Pakistan Dealers of Automobile Association, said the automobile price hike was going on unchecked for a long time.

“The authorities should question the companies as to why the prices are increased so frequently what factors lead to these hikes,” Shehzad said.

He said the Honorable Chief Justice Saqib Nasir, should immediately take action against this price increase and all the automakers should be quizzed about the price increase and cost involved in manufacturing.

“Why consumers have to spend a huge amount to get a reasonable and affordable ride,” the car dealer association leader said adding that the government should promote investment in the auto sector to help increase competition, improve the quality, and bring the prices down.

However, according to an analyst the car sales are likely to drop during the new fiscal year after government’s car-buying restriction on non-filers.

“Out of the total annual sales nearly half of the vehicles have been bought by non-filers,” he added.

Moreover car sales might also take a dip following the State Bank of Pakistan’s decision to increase benchmark interest rate by 50 basis points to 6.50 percent. Estimates show that about 40 percent of the auto sales are made through auto financing.

Shehzad advised the government to allow import new vehicles down the line as it would add to competition and offer choices to consumers.