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Bike sales soar amid falling kit imports

January 25, 2017

KARACHI: Record-breaking sales and production by a Japanese bike assembler and some Chinese players amid plant expansion do not match the imports of completely/semi-knocked-down (CKD/SKD) kits in the last six months.

Imports of CKD/SKD kits plunged 26.5 per cent in July-Dec 2016 to $41 million on a year-on-year basis, figures released by the Pakistan Bureau of Statistics (PBS) show.

Atlas Honda has been breaking sales records for the last few months. United Motorcycle, a leading Chinese bike assembler, has also been following suit. Atlas Honda made record sales in December 2016 with 84,137 units. It sold 458,695 units in July-December, up 16.8pc from a year ago. United Motorcycle sold 161,828 units in the last six months, up 33.2pc year-on-year. It also had record sales of 32,773 units in November 2016.

An official of a leading bike company, who asked not to be named, said the arrival of kits and accessories in the last six months from Japan and Thailand showed only 1pc rise while the arrival of kits from China fell 31pc as per the data of the Federal Board of Revenue (FBR). He said his company is reviewing falling imports of kits despite positive growth in the production and sales recorded by some big players.

Higher localisation of parts and accessories seems to have reduced the import of kits as one of the leading bike assemblers has achieved over 94pc localisation.

Association of Pakistan Motorcycle Assemblers (APMA) Chairman Mohammad Sabir Shaikh said the increase in valuation rates of parts last month might have caused the slowdown in imports, but it could not make such a big impact in the six-month import figure.

He said under-invoicing, misdeclaration and smuggling are some of the main reasons for the falling import of kits. The government needs to lower import duties and valuation rates to curb the menace of parts smuggling, he added.

He said Chinese bike assemblers have become victims of intense competition among themselves. Twenty-six out of 125 assemblers showed zero production in 2015-16 while 32 assemblers shut down their plants. Yet 67 units managed to assemble 2.058m bikes in 2015-16.

Atlas Honda produced 810,539 units in 2015-16 followed by 262,774 units by United Motorcycle, 166,836 units by Road Prince, 148,818 units by Unique, 95,698 units by Super Star, 94,358 units by Super Power, 69,110 units by Crown, 62,560 units by Power and 56,287 units by HI Speed. Yamaha rolled out 20,100 bikes while Suzuki assembled 16,832 units.

In 2015-16, the import bill of CKD/SKD kits went up 4pc to $94m on a year-on-year basis.

In July-Dec, Yamaha’s production fell 60.6pc to 5,000 units from a year ago. However, the production of Suzuki bikes grew 18.4pc to 9,952 units over the same period.

Published in Dawn, January 25th, 2017