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Friday June 14, 2024

July car sales race up 104pc driven by policy boost

Analysts said car sales jumped this year compared to last when restrictions to arrest the spread of Covid-19 had put brakes on economic activities.

By Shahid Shah
August 12, 2021
File photo
File photo

KARACHI: Passenger car sales surged 104 percent in July 2021, data showed on Wednesday, which analysts said were largely driven by demand after reopening of Covid-hit economy and a new buyer-friendly auto policy.

Data released by Pakistan Automotive Manufacturers Association (PAMA), presented that sales increased to 20,669 units in the period under review. That compared to 10,123 units sold in the same month last year.

Analysts said car sales jumped this year compared to last when restrictions to arrest the spread of Covid-19 had put brakes on economic activities.

The government in the FY2022 budget has offered major incentives for the auto sector, which combined with some other expected measures, are likely to become part of the upcoming Auto Policy for 2022-2026.

These incentives were aimed at increasing car sales especially smaller ones, improve share of energy-efficient and environmentally-friendly electric/hybrid cars and enhance overall market size by boosting manufacturing to 300,000 units in FY2022 and to 500,000 units by FY2026, analysts said.

Major measures introduced in the budget include abolishment of 2.5 percent FED (Federal Excise Duty ) along with reduction in sales tax from 17 percent to 12.5 percent for cars with the engine capacity of up to 1000cc, offering a total relief of 7 percent to customers.

In the period under review, sales of trucks, buses, jeeps, tractors, and pickups increased notably, while that of three- and two-wheelers dropped.

During the month, sales of 1,300cc and above cars clocked in at 7,265 units, up 25 percent, compared to 5,803 units sold in the same period.

These sales included 1,700 units of Honda Civic and City, 225 units of Suzuki Swift, 2,320 units of Toyota Corolla, 2,700 units of Toyota Yaris, and 157 units of Hyundai Elantra.

During the month, sales of 1,000cc cars soared to 6,344 units from 1,643 in July 2020, while of those below 1,000cc shot up to 7,060 units from 2,677 last year.

Analysts said auto sales would remain on the upside this year, as customers were set to enjoy some benefits under the new auto policy.

Sales of buses and trucks improved to 343 units in July 2021 from 255 in July 20.

Sales of jeeps surged threefold to 1,200 units from 403 sold in the same period last year.

During this period, 3,049 units of pickups were sold against 1,133 units in the same month last year, while tractors sales increased tp 4,332 units from 3,613 units.

Sale of rickshaws and motorbikes declined to 133,426 units during July 2021. That compared to 149,921 units in July last year.