Pak-Suzuki increases car prices
By Aamir Shafaat Khan
Thursday, 04 Mar, 2010
KARACHI, March 3: Pak Suzuki Motor Company Limited (PSMCL) has increased the price of its newly introduced Swift car by Rs50,000 to Rs1,049,000 from Rs999,999.
On Feb 23, Indus Motor Company (IMC), the makers of Toyota Corolla cars, had raised prices of Corolla Xli by Rs20,000, GLi by Rs30,000 and above 1,800cc and other variants.
PSMCL’s GM Marketing Ashfaq Hussain linked the price hike to yen appreciation against various currencies which pushed up cost of imported parts.
He said Swift contains almost 80 per cent Japanese parts, so its cost of production is also very high.
The company, he said, had not passed on the full impact of Yen appreciation to consumers and is still absorbing a larger portion.
He claimed that to offset substantial loss, the company had increased the prices.
Swift production was started in October 2009 by rolling out five units followed by 92 units in November 2009.
In December 2009, 176 units were produced and sales stood at only two units.
He said January to February 2010 sales of new car were recorded at around 1,100 units. He added that since the engine is a new technology, its cost of production is very high right now. Work on its localisation is going on and it would take some time to increase the content of locally made parts and accessories.
Ashfaq said overall car sales may show some positive trends in months to come as buyers have entered markets, especially form rural Punjab after good crop of wheat, rice, cotton etc.
“In January and February 2010, share of car financing by banks inched up from 20 per cent since some banks have become active in consumer financing,” he said, adding cash and corporate buying has also improved.
Market sources said authorized dealers of all manufacturers are openly charging premium on cars after getting some good response.
Many investors had also plunged in the markets. Growers after harvesting good crops were in a hurry to lift cars on cash even they had to pay extra money on spot buying to the authorized dealers. According to figures of Federal Bureau of Statistics (FBS), import of CKD kits for motor cars in July-January 2009-2010 surged to $238 million as compared to $152.5 million, up by 56 per cent. It means that assemblers have enough orders in hand for onward sale in upcoming months.