Passenger car sales rise 44.6%
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Passenger car sales went up by 44.6% to 67,135 units during the first eight months of the current fiscal year compared to the same period in the previous year due to a significant improvement in buyer sentiment and businesses after the COVID-19 pandemic, new models following the new year, corporate buying, higher prices of used cars, and lower durability of older vehicles, among other factors.
According to data released by the Pakistan Automotive Manufacturers Association (PAMA), sales of all vehicles, including two-, three-, and four-wheelers, increased. However, there was a setback in farm tractor sales. Tractors still failed to achieve any major breakthrough or momentum due to significant crop losses faced by small, large, and progressive growers in the country.
Sales of jeeps and pickups increased by 69% to 22,503 units. Meanwhile, sales of trucks and buses surged by 96.7% to 2,470 units and by 45% to 435 units, respectively. Additionally, sales of two- and three-wheelers (motorcycles and rickshaws) also skyrocketed by 30% to 962,315 units.
However, sales of farm tractors fell by 30% to 21,692 units as growers remain distraught over not receiving fair prices for their crops. The country's overall crop yields continue to decline due to a lack of research and development (R&D) in new seed varieties and unfavourable weather conditions. Most growers are unwilling to cultivate crops due to financial losses and low rates for their agricultural produce.
Speaking to The Express Tribune on Tuesday, auto sector analyst and expert Muhammad Sabir Shaikh said there are various reasons behind the rise in car sales, including the introduction of new models by almost all car brands, the new year and corporate sector buying, and a low interest rate of 12%.
He also noted that the prices of used cars are currently very high, while concerns about their durability persist. As a result, people prefer new vehicles over used ones. A substantial improvement in buying sentiment has been observed after the COVID-19 pandemic. However, the rupee has not yet strengthened against the US dollar.
According to Topline Research official Myesha Sohail, auto sales have increased this year, and the uptrend is expected to continue as new variants enter the market and auto financing recovers amid lower interest rates.
Auto sector analyst Mashood Khan said, "Except for the tractor industry, the market uptrend is visible in all vehicles until the upcoming June. The federal budget for 2025-2026 will be crucial in setting new directions. Policymakers must introduce attractive policies to promote the localisation of vehicles and manufacturing units, which will help reduce vehicle prices, allowing middle-class people to purchase cars. People who earn between Rs100,000 and Rs200,000 a month are unable to afford cars and instead turn to motorbikes."
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