Pakistani Car Sales Experience Significant Fluctuations in August


Pakistani Car Sales

In August 2023, Pakistan’s passenger car sales faced a challenging landscape marked by a 52 percent decline compared to the previous year. A combination of factors, including high prices, expensive financing options, and diminished consumer demand, contributed to the slump in the automotive sector. However, there is a glimmer of hope as sales surged by 60 percent compared to July 2023, attributed to automakers overcoming import-related issues and relaxing import restrictions. This report delves into the details of this rollercoaster ride in the Pakistani car market.


August’s Significant Drop: 


Data released by the Pakistan Automotive Manufacturers Association (PAMA) revealed that passenger car sales, specifically PAMA member cars, plunged by 52 percent to 5,909 units in August 2023, compared to 8,980 units sold in the same month of the previous year. This sharp decline was reflective of the broader challenges facing the sector.


Cumulative Two-Month Decline: 


Looking at the cumulative performance over the first two months of FY24, passenger car sales saw a staggering 50 percent decrease, with 9,611 units sold compared to 19,358 units during the same period in the previous year. Despite this decline, August stood out as a positive outlier, with a remarkable 60 percent month-on-month increase compared to the 3,702 units sold in July 2023.


Segment-Wise Sales: 


Breaking down the sales figures, it becomes apparent that vehicles in the 1300cc and above category bore the brunt of the decline, with a 59 percent decrease compared to the previous year’s sales of 5,684 units. Meanwhile, 1000cc cars recorded sales of 664 units in August 2023, down from 776 units during the same month in the previous year. In contrast, vehicles below 1000cc saw a 16 percent increase in sales, primarily due to the Suzuki Alto sales surge.


Diverse Impact Across Vehicle Types: 


Sales of buses and trucks witnessed a sharp decrease, dropping from 341 units in August 2022 to 167 units in August 2023. Jeeps and pick-ups also experienced a decline, with sales falling from 2,809 units in the same period last year to 1,670 units. However, the sale of tractors saw a modest rise, increasing to 3,967 units from 2,965 units in July of the previous year.


Two-Wheelers and Three-Wheelers: 


The sale of rickshaws and motorbikes encountered a downturn, with 88,318 units sold in August 2023 compared to 102,403 units during the same period in the previous year.


Analyst Insights: 


Sunny Kumar, an analyst at Topline Securities, noted that Pakistan’s car sales, as reported by PAMA, witnessed a monthly increase of 49 percent, reaching 7.6K units. When considering total car sales, including non-PAMA members, the figure stood at around 9K, marking a 46 percent month-on-month increase. Kumar attributed this substantial month-on-month surge to resolving import issues related to Completely Knocked Down (CKD) parts.


Challenges and Contributing Factors: 


Despite this short-term improvement, several challenges persist in the Pakistani car market. Escalating car prices, expensive auto financing options, and reduced consumer purchasing power remain prominent hurdles contributing to the year-on-year sales decline.


Notable Performers: 


Certain car manufacturers buckled the trend in August 2023. Pak Suzuki (PSMC) posted a significant increase of 75 percent month-on-month, driven by surging sales of models such as Alto, Swift, and Cultus. Hyundai also saw a 37 percent month-on-month increase, with Tuscon sales rising by 42 percent. Honda Atlas Car (HCAR) recorded a 36 percent month-on-month increase.


Positive Tractor Industry Trend: 


On a positive note, the tractor industry displayed resilience, with Al-Ghazi Tractors (AGTL) and Millat Tractors (MTL) reporting increases of 52 percent and 46 percent, respectively, month-on-month in August. This pushed total tractor industry sales to 6,645 units in the first two months of FY24, reflecting a 27 percent year-on-year increase.

In conclusion, 


Pakistan’s car sales are navigating through turbulent waters, with various factors influencing market dynamics. While the sector faces challenges, including affordability issues and financing constraints, the industry remains adaptable, demonstrating growth potential in specific segments.

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top