Auto sales race to double-digit growth in July

KARACHI: All the auto sector segments posted double-digit growth during the first month of current fiscal year, running down the street buzz that ‘car buying curbs’ imposed on non-filers of tax returns would put the brakes on sales of four-wheelers, latest data showed on Friday.

Pakistan Automotive Manufacturers Association (PAMA) issued figures presented that sales of vehicles in July FY2019 reached 17,529 units, a jump of 19 percent over 14,676 units sold in July FY2018.

Moreover, on a month-on-month basis, the sales also registered a growth of 24 percent compared to the sales of around 14,095 units in June 2018.

The number showed that the 1300CC and above category climbed 21 percent, 1000 CC variants stepped up 16 percent, and cars below 1000 CC jumped nearly 20 percent with sales of around 9,659 units, 4,433 units, and 3,437 units respectively.

Samiullah Tariq, Director Research at Arif Habib Limited, said changes in the law for the non-filers barring them from buying new vehicles were not visible in the car sales at present; however there’s likelihood that these numbers got a boost from the units booked a month back but delivered this month to the buyers.

“Car sales were on the rise because of the more working days in July compared with June because of Eid holidays, where Indus Motors sales were up because of debottlenecking or expansion in the plant,” Tariq said.

A manufacturer-wise breakup revealed the highest growth was posted by Indus Motors, the makers of Toyota, which registered an increase of 18 percent to reach a sales figure of 5468 units last month.

Moreover Honda recorded a sales growth of 10 percent and Pak Suzuki 4 percent with the sales of 4981 units and 10895 units respectively.

All the car manufacturers in May and June informed their respective dealers that they should inform all the purchasers that they would not entertain the orders of non-filer from the new fiscal year 2018-19.

Abdul Azeem, head of research at Specturm Securities, said despite curbs the local car sales posted an attractive growth.

“The major reason could be the rising demand of vehicles for election campaign, moreover difficulties in the import of used cars also left the buyers with less than fewer choices,” Azeem said.