KARACHI: Car sales slightly fell to 160,359 units during the first nine months of 2018-19 from 161,371 units in same period last fiscal owing to persistent decline in Suzuki Mehran and Bolan. However, March sales soared to 19,897 units from 18,988 units a year ago.

Sales of 1,000-1,800cc vehicles continued to show positive growth led by Toyota Corolla sales which went up to 42,989 units from 38,244 units in 9MFY18.

The combined sales of Honda Civic and City inched up to 32,209 units from 32,074 units while Suzuki Swift sales crawled up to 3,610 units from 3,593 units.

Suzuki Cultus and WagonR sales remained brisk with 17,038 and 24,582 units in the last nine months as compared to 15,624 and 20,771 units in same period last fiscal year.

The above impressive sales performance in 1,000-1,800cc vehicles shows that multiple price increases in cars from Jan 2018 to April 2019 coupled with the no cars for non-filers policy could not dent car sales in the last nine months. The PML-N government had barred non-filers from July 2018 to Feb 2019 from buying vehicles. However, in Jan 2019, the PTI government allowed non-filers to buy vehicles up 1,300cc and later removed the ban entirely in March.

Swelling interest rates from Jan 2018 till April 1, 2019 shrank the share of auto financing to 20 per cent in total car sales from 30-35pc.

Pak Suzuki Motor Company Limited (PSMCL) closed down the production of Mehran VX from November 2019, while April is the last month for VXR model production. The lukewarm response from consumers caused steep decline in Suzuki Mehran sales to 26,402 units from 34,802 units in 9MFY18. Bolan sales plummeted to 13,529 units from 16,263 units. These two vehicles used to enjoy big share in total car sales in previous years.

Toyota Fortuner sales suffered a big fall to 2,009 units in the last nine month of FY19 from 2,741 units in same period last fiscal. Toyota Hilux sales also dropped to 4,568 units from 5,442 units. Sales of these two vehicles were hit by imposition of 10pc federal excise duty (FED). Honda BR-V sales came down to 3,679 units from 6,939 units. A total of 14,408 units of Suzuki Ravi were sold as against 16,241 units in 9MFY19.

Based on paltry decline in the last nine months sales, an analyst at Top Line Securities said overall demand of automobiles is expected to remain subdued due to recent hike in policy rate (+475bps since Jan 2018 to 10.75pc) resulting in higher borrowing cost for auto financing. Furthermore, incremental cost as a result of rupee devaluation and increasing inflation has led to higher car prices, impacting purchasing power of car buyers, he added.

Last week, the government had hinted at removing 10pc FED on engines with 1,700cc above but no official announcement had yet been made, adding to the uncertainty to the car sales with engine size of over 1,700cc, he said.

Truck sales lost the previous trend of smooth demand in the last nine months to 5,027 units from 6,907 units owing to sharp plunge in Hinopak sales to 1,525 units from 3,009 units followed by Isuzu sales to 2,233 units from 2,690 units. Master truck sales stood at 955 units as against 1,079 units. On the contrary, total bus sales climbed to 715 units from 509 units.

In two-wheeler category, sale of Honda bikes witnessed drop to 823,918 units in 9MFY19 from 838,395 units while Suzuki and Yamaha sales improved to 17,873 and 18,193 units from 15,971 and 15,083 units in 9MFY18 respectively.

Published in Dawn, April 11th, 2019