Car sales went down by 44.1% in the first five months of FY 2019-20: PAMA stats

Pakistan Automotive Manufacturers Association (PAMA) has released its sales stats for the month of November 2019, and it shows that the car sales have once again followed the declining trend as they go down by 44%, whereas motorbikes were sold 1.59% higher than its corresponding period last year.

The auto sector slump continues as we witness another month of the ongoing fiscal year 2019-20 with declining sales. During November 2019, car sales have plunged by a significant margin of 44.41%, which is comparatively less than its previous month. It also completes the first five months of the fiscal year 2019-20, and according to the data released by PAMA, car sales have seen a drop of 44.12% from July to November 2019. The low car sales were already anticipated in the last couple of months of the year since the buying trend towards the end of the year is generally on the lower side. The consumers tend to wait for the model year change, and car sales pick up once again with the start of the New Year.

However, the last year has been a tough time for the auto sector of Pakistan due to the prolonged economic slowdown process in the country. Due to a massive devaluation of Pakistani Rupee against the US dollar in the past year, the car prices went up dramatically by more than 30% that also resulted in a notable decline in automobile sales in the local market.

Furthermore, the imposition of several additional taxes and duties has also affected the prices of automobiles adversely. These sky-rocketing prices are way out of the range of the majority of the consumers. As a result, the existing, as well as new auto players in the local market, are all suffering from major losses despite high product prices. The unsold inventories are piling up across the country with no signs of recovery. The motorbike sales have finally seen an upward trajectory after several months. In November 2019, motorbikes sales went up by 1.59% as compared to its corresponding period last year. However, the sales stats of motorbikes and 3-wheelers in the first five months of the fiscal year 2019-20 reveal a plunge of 14.35% as compared to the same period last year. All the stats included in this blog are taken from the PAMA website.

The local sector of Pakistan has largely been dominated by the three Japanese auto giants, i.e. Suzuki, Toyota, and Honda, over the past few decades. However, things have started to change ever since the introduction of the Auto Development Policy (ADP) 2016-21 that offered tax-based incentives to the new auto players. Many auto giants entered the local industry ever since, but the current situation is not appreciable for any of them. Honda Atlas, like previous months, has continued to suffer badly in November 2019 too. It remains the top affected auto manufacturer in the local market as it faced a drop of nearly 62% in November 2019. It was followed by Toyota Indus and Pak Suzuki, who suffered a decline of 55% and 31%, respectively.

The passenger car sales of 1300 cc and above engine capacity have been quite badly affected in the last several months. In the local market, the sales of Honda Civic and City were among the most dented in the period under review. The company doesn’t reveal separate stats for both cars anymore. Combined, a total of 1074 units of both cars were sold, resulting in a drop of 65.92% during November 2019 as compared to the same period last year when 3152 units were sold.

On the other hand, Suzuki Swift remained a low scorer among its competitors. Only 184 units of Swift were sold by the company, which shows a decline of 41.95% as compared to 317 units during November 2018. Toyota Corolla was the hottest selling model in the local market before the economic contraction period begun. Toyota faced a setback with a plunge of 56.18% in its sales of Corolla variants. The Japanese automaker sold only 2172 units of Corolla during November 2019, whereas, in its corresponding period, as many as 4957 units were sold. The passenger car sales of this particular category have seen a drop of nearly 64% in the first five months of the fiscal year 2019-20, which is primarily due to the higher prices of these high-end cars. Have a look at the table below for complete stats.

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As far as the 1000 cc car category is concerned, there are only two cars, i.e. Cultus and Wagon R. The third one to join them is the recently launched KIA Picanto in the local sector. Pak Suzuki managed to sell 914 units of Cultus and 641 units of Wagon R during the last month as compared to 1545 units and 2113 units respectively in the same period last year. The drop in sales of Cultus and Wagon R was observed at 40.84% and 69.66% during this period. The overall car sales in this category went down by 57.49% during November 2019. Wagon R, which used to be the hottest selling model of Pak Suzuki, is now suffering a drop of nearly 75% in the first five months of the ongoing fiscal year.

The passenger car sales below the 1000 cc segment are also following the downward trend. The discontinuation of Suzuki’s iconic Mehran has not much affected the company’s overall sales as it has been taken over by the 660 cc Alto. The entry-level hatchback is the driving force of the company’s sales since its launch. The company has been consistently selling over 4000 units of Alto every month. However, the last month also witnessed a drop in its sales as well. Pak Suzuki managed to sell 2967 units of Alto during November 2019. On the other hand, Suzuki Bolan went through a decline of 57.75% in this period, with 444 units being sold last month as compared to 1051 units in the corresponding period last year.

The overall drop was recorded as 44.41% during November 2019 as compared to the same month during 2018. Similarly, in the July-November period of the ongoing fiscal year, only 49,110 units were sold as compared to whopping sales of 87,897 units in the same period during FY 2018-19. The first five months of FY 2019-20 witnessed a decrease of 44.12% in car sales.

As discussed earlier, the existing three Japanese auto manufacturers have suffered quite badly in the past few months. The car sales of Honda Atlas, Toyota Indus, and Pak Suzuki have decreased by 67.40%, 56.63%, and 30.06% respectively in the first five months of FY 2019-20. Let’s have a look at the individual sales stats of each automaker in the local market.

Alto witnessed the lowest sales ever since its launch:

Pak Suzuki is a major contributor to the overall car sales of the country due to its entry-level and mid-range cars. However, the discontinuation of its 30-year old Mehran raised several questions regarding the company’s future sales. The iconic model of Pak Suzuki held on to a large portion of the overall car sales of the company in the local market. The automaker immediately launched its 660 cc Alto as an alternative to Mehran, which didn’t disappoint at all. Ever since its launch, the company had sold more than 4000 units every month, apart from August 2019, when it sold 3435 units of Alto.

In November 2019, the sales of the Alto have gone further down to 2967 units. On the other hand, the sales of Bolan and Ravi went down by 57.75% and 55.83% respectively in this period. Wagon R sales are already taken over by Alto as it costs the same as Wagon R’s price a year ago. Most of the consumers have shifted to the new-comer in the market. Wagon R was also mainly accepted in the market for use in the ride-hailing companies. The overall sales of Pak Suzuki have decreased by 31.31% in November 2019 as compared to its corresponding period last year. Similarly, the first five months of FY 2019-20 have observed a decline of 30.06% in car sales of Pak Suzuki on year on year basis. Also, note here that the company has not yet observed any non-production days during this period, as in the case of other automakers in the local market.

Toyota Indus shows no sign of recovery:

Toyota Indus Motor Company (IMC) is yet to recover from the current economic crisis. The sales of Toyota Indus are primarily based on its hot-selling Corolla model, which is also in deep waters now. The company managed to sell 2172 units, thus posting a decrease of 43.81% in the month of November 2019. The automaker sold 4957 units in the same period last year, which shows a significant drop in sales. In terms of the first five months of FY 2019-20, the sales stats are even worse as they posted a decrease of 59.37%. The other models of Toyota Indus include Fortuner and Hilux in the local market. The sales of Fortuner also went down by more than 53% in November 2019. The auto manufacturer could only sell 109 units of the compact SUV in the period under review.

On the other hand, Hilux has grabbed more sales in the last month as compared to its corresponding period last year. The company sold 359 units as compared to 286 units, which show an increase of 25.52%. The overall sales of the Japanese auto giant have gone down by 55.10% in the month of November 2019. Similarly, the first five months of the ongoing year generated 56.63% fewer sales this year for Toyota Indus. It is also pertinent to mention here that the automaker has also observed several non-production days (NPD’s) since the beginning of FY 2019-20. It was mainly due to the low demand in the market and piled-up unsold inventories. The company has also introduced various promotions on its automobiles to boost up the sales. Moreover, it’s also planning to discontinue the 1.3L variants of Corolla and replace it with Toyota Yaris in the local sector next year.

Honda Atlas remains the top victim:

The sales of Honda Atlas Cars Pakistan Limited (HACPL) have continued to go down with each passing month in the current fiscal year. The combined sales of Civic and City contribute majorly towards the overall sales of the automaker, but unfortunately, Honda Atlas has seen another month that witnessed a drop of 65.92% in its sales.

It sold only 1074 units as compared to 3152 units in the month of November last year. In the first five months of FY 2019-20, the company has suffered a blow of nearly 70% reduction in the sales of Civic and City.

Honda BR-V, on the other hand, has also failed in boosting its sales despite the introduction of a facelift model. Its 229 units were sold in November 2019 as compared to 300 units during the same month last year. The overall sales of Honda Atlas recorded a decrease of 62.25% in the last month only, whereas the sales stats of the July-November period reveal a downfall of 67.40%. The company also observed only 7 production days during the last month.

Sales of trucks & buses improved slightly:

The overall sales of trucks and buses have improved just a little in the past month, but the results are yet to be encouraging for the auto sector. The sales of trucks were down by 42.20% during November 2019, while 53 units of buses were sold in this period, thus showing a reduction of 20.89%. The overall sales stats for the first five months of FY 2019-20 reveal a reduction of 46.92% on year on year basis.

LCV’s, Vans & Jeeps sales:

As discussed earlier for Fortuner and BR-V, both had a troublesome period with a reduction of 53.81% and 23.66% in their respective sales. The period from July-November shows a reduction of more than half in the sales numbers as compared to the same period last year.

Hilux helps improve pick-up sales:

The pick-ups category has generally shown a downward trend in terms of sales. However, Toyota Hilux did improve its sales in the last month by 25.52%, with 359 units being sold as compared to 286 units last year. JAC, on the other hand, remained on the bottom side in terms of sales, with only 36 units being sold in this period. The overall sales recorded a drop of more than 40% in November 2019, whereas the last five months witnessed a decline of more than 52% in the sales on year on year basis.

Tractor sales went down by more than half:

The PAMA stats suggest that the tractors remained a non-popular vehicle in the month of November 2019, as well. The most notable decrease was observed in the sales of Fiat tractor for which only 418 units were sold in the market in the last month as compared to a whopping 1750 units in the same period last year. Massey Ferguson is another popular brand of tractors in the country, which also witnessed a drop of 26.89% in its sales from last year’s same month. The overall sales did go down by more than 50% in this one month.

Motorbikes & 3-wheelers:

The increase in the prices of automobiles certainly made the motorbikes a popular source of commuting within the city. Although the prices of motorbikes have also surged quite a lot in the recent past, last month has shown signs of recovery for the motorbikes and 3-wheeler industry. Apart from Road Prince, which suffered a decline of 21.69% in its sales during November 2019, other popular brands recovered from low sales. Yamaha almost sustained its sales with 2004 units sold in the last month as compared to 2019 units in the same period during 2018. Other than these, Honda’s sales grew by 5.54% as the largest motorbike manufacturer in the country sold 95,009 units in November 2019 as compared to 90,016 units in the same month last year.

Suzuki also boosted its sales by 10.87% in this period whereas, United motorbikes top-scored with a 14.99% increase in its sales during the specified period. The overall sales in November 2019 grew by 1.59%, which is a positive sign for the motorbike industry. On the other hand, in the first five months of FY 2019-20, only Yamaha has managed to be a better scoring brand among all with an increase in its sales by 2.74% on year on year basis. During the July-November period, the overall sales of this segment are still down by 14.35%.

By analyzing the above stats, a glimpse of recovery can be observed in some categories, particularly motorbikes. However, car sales are still on the lower side, primarily due to the end of the year as well. The auto companies in Pakistan see an improved situation in the country by the start of the next fiscal year. The currency is also creeping up to gain value against the US dollar, which mainly defines the prices of automobiles in Pakistan. The government should also take back the imposition of several additional taxes and duties to let the auto sector flourish in the country.

What are your thoughts on the sales of automobiles in Pakistan? When will the auto sector revive from ashes? Let us know in your feedback and stay tuned to PakWheels for more statistical updates.