KARACHI, July 9: Like 2002-03, the fiscal year 2003-04 ended with a promising fortunes for the automobile sector. Car sales during the outgoing fiscal year rose by 57 per cent followed by a hike of 86 per cent in motorcycles, 21 per cent in light commercial vehicles (LCVs), 34 per cent in tractors and 2.3 per cent in buses.

Similarly, the production of cars surged by 58 per cent, two wheelers by 84 per cent, tractors 36 per cent, LCVs 19 per cent, trucks 4.8 per cent and buses by 6.48 per cent. The entire auto sector gave a robust performance on the back of overall positive economic growth in 2003-04 fuelled by growth in main cash crops, rising export and import activities and a hike in foreign remittances.

A total of 98,461 cars, including Toyota, Honda, Suzuki, Hyundai Santro, Kia Spectra and Daihatsu Cuore, were rolled out in 2003-04 as compared to 62,073 units in 2002-03. The production stood at 40,601 in 2001-02. Similarly, sales of cars touched to 96,674 units from 61,955 units in 2002-03 and 42,341 units in 2001-02.

Car segments have been remained in the limelight because of record low auto financing rates offered by banks and leasing companies coupled with arrival of over $3.8 billion home remittances, introduction of new models and presence of a large number of investors. As a result, car makers had to enhance capacity utilization to meet the growing demand.

The issue of premiums still lingers on. It has been intact for the last two years despite over 60 per cent increase in car production. The government and even assemblers have virtually failed to eliminate the menace of black marketing in new cars. Besides, the issue of late delivery of cars, ranging from two to six months, still persists.

Market analysts believe the growth in car demand may fall this fiscal year because of government's decision of binding the assemblers to sell cars to NTN card holders only.

Fresh bookings of cars have already started declining after June 12 as individual buyers are not turning up. Besides, a cut in import duty on completely built up cars announced in the budget may cause a slowdown in future car bookings in case imported cars arrive at competitive rates.

The boom in production and sales in 2003-04 has been a record for the local car industry, dominated by the Japanese assemblers. In 1995-96, the production stood at 31,079 units, rising to 33,741 units in 1996-97.

The production of cars in 1997-98 was 33,684 units and jumped to 38,682 units in 1998-99, but again fell to 32,451 in 1999-2000. Rolling out of cars started showing improvement in 2000-01 when production reached to 39,575 units.

Arrival of foreign cars may change market shape. Around 800 Chevrolet 800cc cars from Korea had already landed in Pakistan despite no cut in import duty on small cars in the 2003-04 budget. The trade policy 2004-05 announcement by the end of this month will further clear the situation regarding makes and models of imported cars to be allowed for imports.

Pakistan Automotive Manufacturers Association figures reveal that a total of 20,321 Toyota Corolla were sold out in 2003-04 as compared to 12,867 units in 2002-03 and 6,151 units in 2001-02.

Sales of Suzuki Mehran peaked to 27,432 units from 16,582 in the last fiscal year and 9,964 units in 2001-02, followed by Cultus to 10,795 units from 7,927 units and 5,637 units in 2001-02.

Alto 1000cc sales rose to 7,148 from 4,701 units in the last fiscal year and 3,072 units in 2001-02, while sales of Honda Civic increased to 6,097 units from 4,637 units in 2002-03 and 4,625 units in 2001-02.

Honda City sales jacked up to 7,271 units from 3,749 units in the previous fiscal year and 3,382 units in 2001-02. Santro sales increased to 6,922 units from 3,135 units and 2,245 units in 2001-2002, while Suzuki Baleno sales were 4,062 as compared to 2,588 in 2002-03 and 1,188 units in 2001-02.

BIKES: Production and sales stood at 302,262 and 301,407 units, respectively, as compared to 165,105 and 161,863 units in 2002-03 and 120,627 and 120,083 units in 2001-02. Two Chinese units became member of the PAMA, usually dominated by the Japanese bike assemblers like Honda, Yamaha and Suzuki.