Pakistan’s auto sector witnessed a glimmer of hope as automobile sales in May 2023 recorded a month-on-month recovery of 19%. However, it is crucial to note that this improvement comes with a staggering year-on-year decline of 77%. The Pakistan Automotive Manufacturers Association (PAMA) report revealed that approximately 5.3 thousand units were sold during this period.
The rebound in monthly sales can be attributed to the impressive performance of PSMC, which experienced a remarkable 101% increase, as Muhammad Abrar of Arif Habib Limited reported. However, the YoY dip can be attributed to the adverse impact of rising inflation, which has significantly affected consumer affordability.
Furthermore, he said the automobile sector continues to face challenges due to unplanned plant shutdowns caused by import restrictions imposed by the State Bank of Pakistan (SBP). Notably, HCAR’s production plant was shut down for half of May. Experts anticipate that automobile sales will remain under pressure throughout the current calendar year.
According to auto analyst Sunny Kumar from Topline Securities, including non-PAMA members, total car sales reached 6,200, indicating an 18% MoM increase. However, apart from Pak Suzuki (PSMC), all other companies recorded a decline on a MoM basis due to the non-availability of Completely Knocked Down (CKD) parts.
These sales figures bring the total sales for the first 11 months of fiscal year 2023 to 120,158 units, reflecting a significant 52% YoY decrease. This decline can primarily be attributed to the non-availability of CKDs, surging car prices, expensive auto financing, and the low purchasing power of consumers.
PSMC experienced a substantial growth of 101% MoM, selling 2,958 units in May 2023. This surge was driven by increased sales of Alto (132% increase), Swift (129% increase), and Cultus (59% increase). The availability of CKD parts and a low base contributed to this notable upswing.
