Pakistan Automotive Manufacturers Association (PAMA) released latest auto sales data for Feb’19, exhibiting a decline of 13% MoM / 13% YoY to 19,712 units. The slowdown in sales can be attributable to fewer working days in the month of February coupled with escalation of Pakistan-India crisis, massive increase in car prices due to PKR depreciation against green back, ban on non-filers from purchase of new cars, and higher interest rate (Jan’19; Discount rate at 10.75%) era.
In the 1,300cc and above category, sales decreased by 2% YoY / 15% MoM to 8,239 units in Feb’19 owing to 24% YoY and 27% MoM decline in sales of Civic/City to 2,950 units. In 1,000cc category, volumes remained flat on yearly basis while contracted by 19% MoM due to lower dispatches of Wagon R down by 22% MoM.
In below 1,000cc category, Mehran sales dropped by 33% YoY and up by 8% MoM to 2,925 units. In LCVs+4×4 category, total sales stood at 4,286 units, down by 24% YoY / 11% MoM due to significant decline in sale of Toyota Hilux and Honda BRV by 72% and 45% YoY, respectively.
Analysts believe the government decision to allow non-filers to purchase locally manufactured vehicles irrespective of engine capacity along with increase in import duty on used imported cars and restrictions on imports may have material positive impact on local auto industry.
Albeit, as a consequence of additional 10% Federal Excise Duty (FED) on locally manufactured cars on 1700cc and above, INDU recently raised car prices to pass on the impact of FED and rising cost might dent its volumes going forward.
INDU Posted Strong Growth and Revival in Tractor Sales
Noticeably during Feb’19 INDU sales augmented by 8% YoY to 5,529 units due to surge in sales of Corolla by 23% YoY to 4,945 units, and ATLH sales increased by 12% YoY to 95,015 units. On the other hand, Tractor sales improved on a monthly basis as MTL and AGTL’s sales significantly increased by 24% MoM (as plant resumed operations) and 7% MoM to 2,412 units and 1,596 units, respectively.