KARACHI: After a robust performance in 2015-16, the heavy commercial vehicle segment maintained growth in the first two months of this fiscal year.

Hinopak remained the market leader with over 50 per cent market share. It sold 503 units in July-August as compared to 275 in the same period of last year, an increase of 82.9pc.

It was followed by Isuzu, which sold 368 units in July-August, up 164.7pc from 139 units sold in the same period a year ago.

Nissan truck sales rose 21.7pc year-on-year to 168 units while Master sold 149 trucks, up 14.6pc from 130 units sold in the same period a year ago.

Hinopak dominated the bus segment as well in the first two months of 2016-17. It sold 192 buses in July-August as opposed to 104 units in the same period a year ago, showing an annual rise of 84.6pc.

Bus sales by Isuzu increased to 18 units in July-August from 11 units a year ago while Master sold 17 units as opposed to just one unit in the preceding fiscal.

A heavy vehicle assembler said some assemblers had received major orders from the armed forces and the Punjab government. The China-Pakistan Economic Corridor (CPEC) also created additional demand for trucks, he said.

However, Hinopak Motors Head of Strategic Business Planning and Plant Operations Naushad Riaz offered a different view. He said a high commercial demand has changed the dynamics of the heavy vehicle segments, especially trucks and prime movers, which are also considered a barometer of economic growth.

In addition, a growing large-scale manufacturing (LSM) sector also augurs well for the trucking industry, he added.

He claimed that truck orders from Defence, Punjab government and CPEC-related projects are not significant in view of the overall growing demand from the commercial market.

He said the period from October to December may prove ‘crucial’ for the sales of commercial vehicles, especially trucks, in view of the emerging political situation coupled with the expected arrival of a new army chief.

Riaz said policies of the government have played a major role in boosting sales of heavy vehicles. It is true especially in the backdrop of the new Auto Development Policy, where an age limit was imposed on the import of used commercial vehicles that created space for the local industry.

The rise in demand also absorbed the impact of the price increase on prime movers of 280HP and above. The government increased the duty on the import of completely knocked-down (CKD) kits for prime movers of more than 280HP from zero to 5pc in July. It had also decreased the duty to 5pc from 10pc on the import of prime movers of less than 280HP.

In the completely built-up (CBU) category, the import duty has been reduced to 20pc from 30pc on prime movers of less than 280HP.

The import duty was raised to 20pc from 15pc on prime movers of over 280HP. After the revision in the duty structure, some assemblers had increased/decreased the prices of heavy vehicles while others tried to maintain the price level.

To continue this momentum, Riaz said no change is required in the recently announced auto policy, especially with regard to the age restriction on used commercial vehicles.

He added that many importers have already approached the Ministry of Commerce and the prime minister’s office with false claims to get the age restrictions reversed.

He emphasised that duty- and tax-free imports of commercial and special-purpose vehicles for CPEC projects should be limited to only those categories of vehicles that are not manufactured in the country. This will further boost the industry’s confidence and size, he added.

Published in Dawn September 20th, 2016