KARACHI: Car sales amounted to 97,532 during July-December 2016, an increase of 14% year-on-year if sales counted under the Punjab Taxi Scheme are to be excluded, signifying strong growth within the limited number of manufacturers in the country.
However, including sales made under the Apna Rozgar Scheme, which Pak Suzuki Motor Company (PSMC) produced on the order of the Punjab government during July-December 2015, overall car sales declined 13% in the six-month period ended December 31, 2016.
But given the higher benchmark number of 2015 was induced through the government, one is inclined to exclude the number.
“Auto sales continued to witness strong growth in 1HFY17 (ex-Taxi scheme),” Hashim Sohail, an analyst at Topline Securities, said in a note to his clients. “We expect car sales, including imports of 60,000 units, to clock in at 270,000 units in FY17.”
He said that the car sales in the single month of December 2016 stood fairly in line with expectations at 16,041. “Sales contracted on month-on-month basis as seasonality factor kicks in,” he said.
Topline infographs showed recovery in growth of sales of 1,000-1,200cc cars in December 2016. On the contrary, the sales of cars in the categories of 800cc-,1,000cc; 1,300cc and above and light commercial vehicles showed downturn in the single month.
PSMC volumes remained strong (ex-Taxi scheme) due to robust sales volumes of Wagon-R and Bolan in 1HFY17.
Indus Motors witnessed contraction during the half-year under review “due to operational issues during Jul-Oct and phase-out of old Hilux and Fortuner,” he said.
Honda Car sales stood strong during the period as “euphoria of new Civic continues.”
Sohail added that local tractor manufacturers reported buoyant sales during the half. “We expect better off-take during FY17 on the back of lower GST [general sales tax] rate of 5% and improving crop yield. However, discontinuation of urea subsidy may adversely impact liquidity among farmers going forward,” he said.
Truck sales of Pakistan Automotive Manufacturers Association’s member companies in 1HFY17 remained strong. Major increase was seen in sales of GHNI followed by Master Corporation and HINO. “We foresee buoyancy in truck sales to continue, fueled by increased demand under China-Pakistan Economic Corridor and improvement in law and order,” he said.
“Volumes of two and three wheelers continued to post growth on the back of improvement of law and order situation while lower petrol prices in the country, further supported volumes,” he said.
Published in The Express Tribune, January 11th, 2017.