Due to the record-breaking continuous rupee devaluation and a number of duties and taxes levied by the government, Pak Suzuki Motor Company has increased the prices of its vehicles which will come into effect from 1st July 2019.
After the increase in the prices of the vehicles of Honda, Toyota, Al-Haj FAW and Isuzu, it was just a matter of time when Pak Suzuki revises its car prices. It will take some time for the consumers to digest this particular price hike by Pak Suzuki because the new prices of cars look quite unrealistic and no would have even imagined this a year ago. Moving on, the negative impact of rupee devaluation and the imposition of Federal Excise Duty (FED) on all cars had made it obvious that all the auto manufacturers will be forced to increase the prices of their cars. The government has recently introduced three slabs in which 2.5%, 5% and 7.5% FED is imposed on the vehicles in accordance with their engine capacity. All these factors contributed to the price hike bomb to be released on the consumers. According to the circular sent to all the Suzuki dealerships across the country, the Japanese auto manufacturer has clearly stated the above-mentioned reasons for its price hike. The company was compelled to pass on the impact on the market. The official notification of PSMC is attached below:
The maximum increase in the price was observed in Suzuki Swift AT NAV that went all the way from Rs.1.721 million to Rs.2.05 million with a difference of Rs.329,000. The price of Suzuki Wagon R VXR and VXL is raised from Rs.1.264 million and Rs.1.344 million to Rs.1.54 million and 1.1.625 million respectively. Similarly, the price of Suzuki Cultus VXR is increased by Rs.305,000 to Rs.1.745 million whereas its VXL variant is now priced at Rs.1.855 million with a difference of Rs.304,000. Suzuki Vitara has now become costlier by Rs.205,000 with the new price of Rs.4,295,000. A comparison of old prices and the new prices is described in the chart below:
It is important to mention here that the above retail prices are inclusive of the following taxes:
- 17% Sales tax on the ex-factory product price
- Freight charges incurred on the vehicle to reach the premises of dealership
- Federal Excise Duty (FED) levied by the government in accordance with the following table:
The new prices of Suzuki products reveal that the top of the line variant of Cultus has almost reached the 2 million mark. Even the prices of Suzuki Bolan have crossed the 1 million mark which is quite surprising, considering the quality and product offered by the auto manufacturer in these vehicles. The company has increased the prices of all its CKD and CBU units in this notification. The imposition of FED on all cars made it even worse for the consumers to digest the new prices of these vehicles. The buying power of the general public is reducing significantly with each passing day because Suzuki is an entry-level auto manufacturer in Pakistan and a lot of market share has been under the company’s name for a long period of time. I reckon it will take some serious thinking for a potential buyer before looking to purchase even a new Suzuki car now. On the other hand, the decline of rupee against the US dollar has left all the auto manufacturers with no choice but to increase the prices of their products.
How do you see the future of the automobile industry of Pakistan under such deteriorating economic circumstances? Let us know in the comments section below and stay tuned to PakWheels for all the latest statistical updates on the automobile industry.