Car sales declined in July due to increased prices

• Car sales in Pakistan fell by 64% in July 2023 compared to the previous year.
• The decline in sales was attributed to rising interest rates and prices, which have discouraged potential buyers.
• Honda Atlas Car (HCAR) saw a 61% MoM increase in sales, while Hyundai also saw a 2% MoM increase.

Car sales in Pakistan experienced a 64% drop in July compared to the previous year, attributed to elevated interest rates and prices that have discouraged potential buyers, according to industry data reported by The News.

With the exception of tractors, the sales of various vehicles such as trucks, passenger cars, pick-ups, jeeps, three-wheelers, and two-wheelers have all recorded a decline during this period.

According to data from the Pakistan Automotive Manufacturers Association (PAMA), the sale of passenger cars (PAMA member cars) dropped by 64%, with 3,702 units sold in July 2023 compared to the 10,378 units sold in the same month of 2022.

Sunny Kumar, an analyst at Topline Securities, attributed the decrease in car sales to rising car prices, costly auto financing, and consumers’ limited purchasing power.

In this timeframe, sales of cars with engines of 1300 cc and above reached only 1,694 units, marking a 62% decrease from the 4,464 units sold during the corresponding period last year.

The sales for this year comprised 208 units of Honda Civic and City, 249 units of Suzuki Swift, 1,067 units of Toyota Corolla and Toyota Yaris, 80 units of Hyundai Elantra, and 90 units of Sonata.

Within this timeframe, 1000cc cars registered sales of only 422 units, consisting of 177 units of Suzuki Cultus and 245 units of Suzuki WagonR.

Vehicles in the 1000-cc category achieved a sales count of 1,586 units, encompassing 146 units of Suzuki Bolan and 1,440 units of Suzuki Alto.

Buses and trucks experienced a decline to 195 units in July from the previous year’s 274 units in the same month. Similarly, the sales of jeeps and pickups decreased to 1,390 units from the 1,547 units sold during the corresponding period last year.

Nonetheless, the sales of tractors showed an increase, rising to 2,678 units from 2,254 units in July of the previous year.

The sales of rickshaws and motorbikes declined to 73,588 units in July 2023, compared to 96,421 units during the same period last year.

Indus Motors (INDU) experienced the most significant decline of 26% month over month (MoM) in July 2023, with sales dropping to 1,368 units. This was primarily driven by a 65% MoM decrease in the sales of Fortuner and Hilux models.

Yet, Honda Atlas Car (HCAR) witnessed a 61% month-over-month (MoM) rise in July 2023, primarily attributed to a comparably lower base from the previous month.

Hyundai also saw a 2% month-over-month (MoM) increase in sales, while Tuscon sales experienced a 5% MoM rise, reaching 328 units in July.

In the tractor sector, Millat Tractors (MTL) observed a 22% month-over-month (MoM) drop to 1,656 units in July 2023, while Al-Ghazi Tractors (AGTL) achieved sales of 1,022 units, marking a 20% MoM increase.

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Truck and bus sales experienced a 31% month-over-month (MoM) increase but saw a 29% year-over-year (YoY) decline to 195 units in the reviewed month.

Bike sales in Pakistan witnessed an 11% month-over-month (MoM) and 24% year-over-year (YoY) decrease in July 2023. Atlas Honda (ATLH) reported sales of 62,000 units, marking a 17% MoM drop and a 23% YoY decline. The decline in sales is mainly attributed to increased bike prices and consumers’ limited purchasing power.

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