Pakistan’s automobile manufacturers’ sales decline 44% in November 2019

Pakistan’s automobile sales

KARACHI: Pakistan Automotive Manufacturers Association (PAMA) published monthly automobile sales data for November 2019 wherein passenger car (PC) sales plummeted 44% to 8,524 units, with downturn in volumes witnessed in all categories during the month.

Truck/ Pickup volumes plunged 42%/40%, however, on a sequential basis demand rose 40%/7% with 330/978 units sold during the month. Additionally, bus sales were down 21% to mere 53 units while SUV volumes also recorded decline of 37% to 338 units in November 2019.

Overall auto sales contracted 44% to 10,223 units during November 2019.

On aggregate basis, automobile sales registered 45% decline to 57,159 units during 5MFY20 (July-Novmber 2019).

Pak Suzuki Motor Company (PSMC)’s sales for the month of November 2019 clocked in at 5,846 units, depicting a hefty decline of 31%. Consistent with previous months, apart from newly introduced Alto, sales of all other models remained under pressure during the month with Swift, Cultus, Wagon-R, Mehran, Bolan & Ravi recording 42%, 41%, 70%, 94%, 58% and 56% decline in volumes.

Alto sales (2,967 units) constituted 51% of total volumes as PSMC improved its market share 11pps to 60% during November 2019.

Indus Motor Company (INDU) witnessed notable decline of 52% with 5,846 units sold during November 2019. Demand for Corolla/Fortuner plummeted 56% /54% whereas on sequential basis, volumes rose 10% /8% to 2,172/109 units owing to the aggressive marketing campaign undertaken by the company.

Moreover, Hilux volumes improved 26% during November whereas on a monthly basis, sales fell 13% to 359 units. Corolla accounted for 82% of total sales of the company as INDU’s market share fell 4pps to 27% during November 2019.

Honda Atlas Cars (HCAR) continued to record notable fall of 62% during the month at 1,303 units sold. The company’s PC sales (Civic & City) arrived at 1,074 units as compared to 3,152 units sold during corresponding month of last year. BR-V volumes also recorded 24% decline at 229 units. HCAR’s market share declined 6pps to 13% during the month.

Truck & Bus sales arrived at 383 units with sales of HINO arriving at 158 units. Moreover, Master sold 50 units during November 2019 while ISUZU’s sales declined 40% at 175 units.

Tractor sales fell 50% with 1,818 units sold during the month as sales of FIAT arrived at 418 units, while Massey Ferguson registered 27% fall in sales to 1,400 units during November 2019.

Prevailing economic slowdown, surge in inflationary levels eroding consumer’s purchasing power, higher interest rates along with increased emphasis by the government towards formal documentation are likely to keep demand for the auto industry in check.

“However, we highlight start of reversal in interest rate cycle from CY20 as a key determinant in gradual revival of demand for the sector as auto financing constitutes 30-35% of total industry sales. Moreover, with exchange rate attaining much needed stability and central bank’s reserves continuing to inch up, we expect margins for auto manufacturers to remain stable in the near term,” a report issued by Pearl Securities noted.

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