On Thursday, analysts said car sales in Pakistan registered the annual growth in August for the first time after 16 months downtrends with the rise of 8.3 percent year on year as lower interest rates are encouraging auto financing.
Car sales last increased YoY in March 2019. Passenger car sales shot up from 9,126 units in the comparable period last year to 9,885 units in August. But in August, they dipped 2.3 percent as opposed to July according to the Pakistan Automotive Manufacturers Association (PAMA). There has been seen a year on year growth on Sales of jeeps, tractors, three-wheelers, and motorcycles.
The policy rate from 13.25% to 7% has been cut by the State Bank of Pakistan in around 3 month period for which analysts call led to reinvigorating auto financing.
During the discussion with media on Car sales growth in Pakistan, Hammad Akram Topline Securities analyst elucidated that the demand for cars was expected “to grow stronger as lower interest rates for auto financing along with pick up in economic activity amidst declining cases of COVID-19 has revived demand for new cars”.
Sales of 1300cc or above cars depicted a rise of 58.4% to 4,748 units in August, compared with 2,997 units sold in the same month, last year. The major reason for the sales increase was the sale of 1,705 Toyota Yaris during this period.
Toyota Corolla sales crashed 50% from 1,727 units sold a year earlier to 867 units, while those of Honda Civic and City shot up 79% to 1,980 from 1,106 units. Suzuki Swift also saw a growth in sales, from 164 cars to 196 cars. Whereas Suzuki Cultus and Wagon R, under the category of 1000cc has been observed a 10 percent increase in sales to 2.133 as against 1,934 units last year.
Under 800cc, sales dropped 28.4% from 4,195 units during last year’s corresponding period to 3,004 units in August. The new model of Suzuki’s Alto saw a 30.5% decline in sales from 3,435 units to 2,389 units.