In the recent times, country’s automobile industry seems to be shattering as the country enters a period of hyperinflation. Amidst these difficulties, Honda, one of the prominent car manufacturers in Pakistan, has reported selling only around 56 units of its popular models, City and Civic, last month against 159 vehicles sold in April.
The eroding sales are not just confined to the City and Civic, BR-V and HR-V faced the same fate last month. The company sold only 31 units of both cars in May. Overall, Honda Atlas sold 87 units last month observing a slump of 58%.
Meanwhile, Honda’s Japanese peer Toyota Indus Motor’s sales decreased by 12%. The company sold 1,718 units. Whilst Pakistan Suzuki performed different, recorded a jump of 101% selling 2,958 vehicles last month.
Car Sales Increased by 19% Last Month
After a decrease of 85% in April, car sales performed slightly better last month. As per Pakistan Automotive Manufacturers Association (PAMA) car sales observed a month-on-month (MoM) jump of 19% selling 5,290 vehicles in May against 4,463 units sold in April.
Coming to year-on-year (YoY), sales recorded a staggering low of 77%. Car makers sold 22,893 vehicles in the corresponding period of last year.
The Hyperinflation
Hyperinflation refers to a rapid and uncontrollable increase in prices, eroding the purchasing power of the currency. Unfortunately, Pakistan has experienced such a situation lately, leading to severe economic repercussions across various sectors, including the automobile industry. This hyperinflationary environment has created a challenging road ahead for car manufacturers and consumers alike.
Car manufacturers in Pakistan have been grappling with a series of obstacles that have hindered their growth and profitability. These challenges include rising production costs, a shortage of raw materials, and now, hyperinflation. As the cost of inputs such as steel, rubber, and fuel surges, manufacturers face the dilemma of either absorbing the increased costs or passing them on to consumers, which may further discourage potential buyers.
