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Frowning over lost customers

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Frowning over lost customers
Karachi’s car markets

photos: athar khan/Bol News

Used car dealers decry high duties, lack of fuel-efficient vehicles in an uncertain car market

Karachi: A visit to Karachi’s car markets on Khalid bin Waleed Road and New MA Jinnah Road has revealed that only a small number of fuel-efficient vehicles were available for sale.

These vehicles ranging 660cc to 800cc that are often in demand were barely on offer in the used car market as people who owned these vehicles seemed unwilling to resell them.

There were, however, a number of big and luxury used vehicles available for sale, therefore offering less choices for people already strained by inflation.

Moreover, there are very few buyers seen in the car market as people apparently showed no interest in replacing their old vehicles at a time when the prices of both used and new vehicles are uncertain.

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Waleed Khan, a car dealer on New MA Jinnah Road, told Bol News that due to the high inflation and uncertain economic and political situation, car buyers have disappeared from the markets. “There are only 15 to 20 per cent buyers in the market and the buyers of small vehicles are even lesser in number”, he added.

The prices of used Japanese vehicles had gone up multiple times, he further said. “The 2005 and 2007 models of old imported Alto 660cc was available between Rs1.2 million to Rs1.4 million. And this was the minimum price of a good condition vehicle, not an excellent one.”

Similarly, the prices of Mira 660cc of the same years of 2005 to 2007 started from Rs1.4 million, he also said.

However, the 2019 Mira was available in the market at Rs3.2 million to Rs3.4 million, the Japanese Alto for Rs2.4 million while the locally manufactured Alto was available for Rs2 million to Rs2.1 million, depending on the condition, the car dealer added.

He said that people also demanded the old Corolla of 1991 to 1994 model and these were being sold for around Rs1.4 million.

All Pakistan Motor Dealers Association (APMDA) Chairperson H M Shahzad said that the incumbent government, during its eight months so far, raised the prices on vehicles eight times. “The car assemblers hoodwink the people on one pretext or the other,” he alleged.

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There’s no mechanism of fixing profits and prices, the APMDA chairperson complained. “You can’t hold the assemblers accountable. The three brands looted the people and now seven more companies have joined them to fool the consumers.”

A buyer of a used car, Tauqeer Ahmed said, “I saved Rs500,000 to buy a Japanese imported used car. But by the time I had saved that amount, the price went up to Rs800,000.”

Tauqeer continued, “Now, when I finally have Rs800,000 in my hand, the prices of cars have risen to Rs1 million to Rs1.2 million. The prices are going up very fast and I don’t know if I will ever be able to buy a used car of my choice.”

Muhammad Adil Khan, a car importer on Khalid bin Waleed Road, termed the local assemblers ‘mafia’ and said, “This mafia is exploiting the end user. There is no price check, no quality check of vehicles and this mafia delays the delivery of cars by nine months or so, even after the payment.”

He complained that the car dealers were the stakeholders but they were never taken on board while devising automobile policy. “The government imposed heavy duties and taxes to discourage the import of vehicles in a bid to protect the local manufacturers who were actually mere assemblers and not manufacturers.”

Waleed Khan commented that those people belonging to the middle-class, who owned fuel-efficient vehicles, did not normally sell their vehicles unless and until they needed money in an emergency.

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photos: athar khan/Bol News

“The ban on the import of used vehicles had just been lifted by Finance Minister Ishaq Dar. However, the taxes and duties were increased from 400% to 800% Due to this heavy increase in taxes and duties, if these vehicles were imported, the prices would be doubled. So lifting of ban coupled with a heavy increase of duties and taxes was of no use.”

Jamil Chaudhry, a showroom owner, remarked that the imported cars were reliable, with better quality of engine and suspension. “And the prices were also ‘fine’ for the common man who could purchase it. But after the imposition of 800 per cent duties on the import of such cars, the prices went beyond the reach of many consumers.”

Chaudhry further said that local assemblers should be asked to manufacture all spare parts of the vehicles locally so that local industries are developed and employment opportunities are created.

“By manufacturing parts locally instead of importing them, the prices of vehicles would also come down,” he claimed.

Muhammad Jamal Mughal, another car dealer at Khalid bin Waleed Road, said that hybrid and fuel-efficient vehicles should be imported so that fuel money could be saved. “The government spends billions of dollars buying fuel for vehicles.”

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Echoing Mughal’s remarks, Chaudhry also said that the government should allow the import of electric cars commercially so that the country can save as much as it can on petrol and diesel.

“Furthermore, the duty on the import of electric cars should be zero in a bid to promote this automobile. If this proposal was approved, the prices of cars would also be brought down and the country would save billions of dollars on fuel.”

“Moreover, when you purchase a new car, you will be given a delivery date of not less than six to nine months. However, if you buy the car in the black market by paying an extra Rs1 million to Rs1.5 million, your vehicle will be delivered within two days on your name,” he claimed.

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