Car sales in Pakistan slumped more than 30 per cent in July, compared to the corresponding period in 2009, after the government increased sales tax that raised the prices of vehicles and devastating floods that hit the country.
According to data released by the Pakistan Automotive Manufacturers Association (PAMA), Pakistan Suzuki, a market leader in the small family cars category, saw its sales falling 48 per cent during July 2010.
Their newest product "Swift" in 1300 hatchback category has particularly failed to lure potential buyers and only 195 units have been sold since its launch in January 2010. Indus Motors, which markets Toyota, was the only company to show a 5 per cent surge in sales during the same period, due to increasing rural demands and the government, which goes for purchase of new vehicles every year. Urban Pakistan tends to prefer Honda because of its sleek technology and up-market branding.
However, the company suffered a 35 per cent decline in sales during the given period. Heavy vehicles like trucks, buses, tankers and tractors also dropped down by a minimum of 15 per cent to a maximum of almost 50 per cent in different categories.
PAMA data revealed that the sales of automobiles had gone down despite increase in production in almost all the companies. The sales of motorbikes and three-wheelers did not show any significant change as compared to 2009.
Abdul Razzaq, a local car dealer, said the depressing sales trend was likely to continue for a while because of increase in prices and devastating floods in the country.
The commerce ministry has reportedly proposed last week that age-limit for import of used cars should be enhanced from three years to five to combat the price hike. Prime Minister Yousuf Raza Gilani is likely to take a final decision in this regard.