Auto industry projects rapid growth
During the meeting, the chairman emphasised the need for recovery of the arrears. PHOTO: file
The automobile companies of Pakistan have projected sharp growth owing to reduction in age of earning in Pakistan on the back of rapid digitalisation.
“On average, the first paycheck was received by the previous generation at the age of 27 but now, the threshold has declined to 21 years, thanks to the opportunities arising from digitalisation,” said Changan Master Motors Sales and Marketing Director Syed Shabbiruddin.
The company is targeting customers of age group 25 to 64 years, revealed a presentation given by the official.
A massive chunk of youth belonging to the generation Z is entering the pool of car buyers with each passing year.
Such people begin to earn from a young age, at around 21 years, and rapidly advance through the social classes of the society, he said.
“Growing number of females in the corporate sector will also result in a notable increase in the proportion of females buying their own cars,” he said. “Each year, one in six affluent customers purchases a new car on average.” The affluent class will widen to 21 million people by year 2026, 27 million by 2031 and 29 million by 2036.
SI global CEO Noman Ahmed Said told The Express Tribune that due to rapid increase in online jobs, youth has far better chances to earn compared to previous generations.
The introduction of new manufacturers and the support provided by the government paved the way for the increase in car sales in the economy, he said.
The transformation of car manufacturing from mechanical to technology based ones has played a pivotal role in shifting youth’s preference of car variants. “The automobile industry continues to adapt and transform to this day,” said Said.
He was of the view that besides propping up the number of car sales, youth could also play an important role by producing of automobiles and their parts and establishing authentic platforms for purchase of online spare parts.
Union of Small and Medium Enterprises (UNISAME) President Zulfikar Thaver said that auto sector was no doubt presenting attractive opportunities to youth.
“However, the automobile industry needs to manufacture more and more localised parts and lessen the burden on the exchequer,” he said.
Although the automobile industry has bright future prospects, but it might witness negative growth for a few years, he said. Ismail Iqbal Securities analyst Muqeet Naeem projected a decline in car sales in fiscal year 2022-23 due to expectation of high interest rates, restrictions on auto financing and reversal of tax benefits announced by the government in budget 2021-22.
Published in The Express Tribune, March 8th, 2022.
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