Impact of taxi scheme: Car sales slow down in first two months of FY17

Local assemblers sold 31,585 units in July and August

Our Correspondent September 15, 2016
A group of Chevrolet Camaro cars for sale is pictured at a car dealership in Los Angeles, California. PHOTO: REUTERS

KARACHI: Sales of locally assembled vehicles, including light commercial vehicles, vans and jeeps, dropped 13% to 31,585 units in the first two months of financial year 2016-17 compared to the corresponding period of previous year, shows the data released on Thursday.

However, the demand stood higher by 19.7% in July and August 2016 if taxi units sold last year under Punjab’s one-off Apna Rozgar Taxi Scheme were excluded. “This was in line with expectations,” commented research house Topline Securities in its report.

Car sales jump 24% in July-May

“We expect car sales to remain robust in FY17 despite the conclusion of taxi scheme and see demand hitting 217,000 units, an increase of 30% year-on-year (excluding taxi units),” it said.

The research house based its expectation on the likely launch of a new model, Celerio 1,000cc, by Pak Suzuki Motor Company by the end of this year and continued demand for Corolla produced by Indus Motor Company.

Pak Suzuki Motor Company - the largest assembler by market share - sold 16,662 vehicles in the first two months (July and August) of FY17, registering a decline of 26% year-on-year.

This was primarily because of reduced sales of Ravi and Bolan variants because of the end of taxi scheme.

However, sales were healthy excluding the taxi units as the company sold 10,907 vehicles, up 12%.

Car sales continue to speed up

Sales of Indus Motor edged down 2% in the first two months as July saw less working days due to extended holidays. The company sold 9,628 units during the period.

In August alone, sales were flat with the company operating at full production capacity.

Sales of Corolla fell 8% month-on-month to 4,572 units, thanks to the introduction of a new Civic model by rival Honda Atlas Cars. Hilux demand, however, accelerated 61% month-on-month to 809 units.

Honda Atlas Cars sold 5,295 units in the first two months of FY17, recording an increase of 15% year-on-year. Sales for August soared 59% to 3,174 units.

Car sales accelerate on cheap financing, taxi scheme

The increase came mainly on the back of demand for the new Civic model, which generated great interest among the customers.

According to an advertisement published a few weeks ago, Civic orders have been completely booked for 2016 and delivery for the bookings being done now will be made in 2017.

Published in The Express Tribune, September 16th, 2016.

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