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Pakistan Autos Report Q1 2011
Business Monitor International, Dec 2010, Pages: 39
The Pakistan Autos Report provides industry professionals and strategists, corporate analysts, auto associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Pakistan's automotive industry.
Pakistan produced a total of 218,300 vehicles in fiscal year 2009/10 (July to end June), up 32.2% from 165,158 in fiscal year 2008/09, according to figures from the Pakistan Automotive Manufacturers Association (PAMA). The 2009/10 aggregate production figure is inclusive of 121,647 passenger cars, 3,425 trucks (category 1), 628 buses, 4,053 trucks (category 2), 1,172 jeeps, 15,768 pick-ups and 71,607 tractors. Meanwhile, sales of new vehicles in 2009/10 registered 221,720 units, inclusive of 123,957 passenger cars, 3,620 trucks (category 1), 657 buses, 4,277 trucks (category 2), 1,201 jeeps, 16,496 pickups and 71,512 tractors. The aggregate 2009/10 sales represented a rise of 36% year-on-year (y-o-y). Production largely mirrors sales in Pakistan’s auto market.
However, while the vehicle sales and production figures in 2009/10 may have appeared impressive in percentage y-o-y terms, they were less impressive when viewed against historical figures (and a very low 2008/09 base). Political turmoil in Pakistan, in tandem with the global economic downturn, delivered a double whammy to car sales and production in the country over FY08/09. Sales of new vehicles in Pakistan fell 34% y-o-y during that fiscal year. The 163,479 new vehicles sold in Pakistan in 2008/09 compared very unfavourably with the 247,160 in fiscal year 2007/08 – and, of course, the 2009/10 aggregate sales figure remained considerably below the 2007/08 base. Meanwhile, production of new vehicles in FY2008/09 was down 33% y-o-y, from the 247,036 units produced in FY2007/08. As with sales, the year 2007/08 remains a high watermark for vehicle production in Pakistan’s car industry, as aggregate production in 2009/10 remained nearly 12% below the level of two years earlier. The start of FY10/11 saw new car sales fall by 31.6% month on month (m-o-m), to 9,796 units in July, as customers felt the impact of an increase in General Sales Tax (GST) and with heavy flooding causing displacement of people and severe disruption to business across the country. However, this poor monthly performance did not mark the start of a negative trend, with August sales up by 9% y-o-y (to 19,625 units), September sales up by 6% y-o-y (to 10,405) and October sales up by 17% y-o-y (at 11,911). All told, the first nine months of 2010 have seen a total of 117,052 passenger car units sold. Over the same period, passenger car production stands at 111,554 units.
This upwards sales trend has come as a surprise to most industry analysts, who had expected a combination of a weak rupee and falling income and demand from flood-affected areas to have sent car sales lower. It may be, however, that with the Pakistan rupee and consumer demand both set to remain weak into 2011, customers are choosing to buy new cars now, for fear that they will continue to increase in price over the coming months. Certainly, local media have speculated that this is what car dealerships have been doing, buying cars in at current prices to hedge against future likely price rises. Against this backdrop of higher-than-anticipated car sales in recent months, BMI has made an upwards revision to its forecasts for passenger car sales for 2010 (calendar year). We now believe that a total of around 138,155 cars will be sold, representing an increase of 25% y-o-y. This revision has also led to a slight increase in our sales and production forecasts for future years as well.
Topics Include:
Autos, auto trade, vehicle sales, vehicle, automakers, autos export markets, car, van, carbon emission, commercial vehicle export, scrappage, autos industry, parts maker, automobile, motor, commercial vehicle, HCV, LCV, alternative fuels and hybrid vehicles.
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