car sales april 2020
credits: FinancialTimes

12th June 2020:

April came as a shock to the automotive industry of Pakistan as ‘0’ car units had been sold. Mainly, the reason behind this was the lockdown imposed due to the novel coronavirus.

Now that the lockdown has eased, the brands have seen minor sales. However, according to the latest reports by Pakistan Automotive Manufacturer’s Association (PAMA), there has been a 75% plunge in sales this year, compared to the same time last year.

Only 3,800 units were sold in May this year, compared to the 15,428 units that were sold in May 2019. In contrast to April, the month of May was a blessing for some of the manufacturers, but still not enough.

Moreover, the reports revealed that sales fell by 89% for cars with 1300cc or larger engines. Only 802 units were sold in May. Sales of Toyota Corolla alone has fallen by 93% with only 294 cars sold as compared to last year’s 4,069.

For Toyota, the 1300 and 1500cc Yaris has not been able to captivate the market as of yet. So far, only 167 units have been sold because of the coronavirus pandemic!

13th May 2020:

April has been by far one of the worst-performing months for the local automotive industry.

The Pakistan Automotive Manufacturers Association (Pama) has recorded ‘0’ sales for the month because of the country-wide lockdown caused by the novel coronavirus.

Unfortunately for the local auto brands, the sector was already suffering from a 47% decline before the virus. After the government initiated the lockdown, the sales started to flunk even more.

Moreover, local assemblers, as per the government’s orders, had to shut down their factories and plants from 23rd March, and since then, productions have been halted.

Now that the government has eased the lockdown restrictions, making it easier for the smaller market and business owners to earn a living, there is still no telling when the local assemblers will be able to resume their production.

The Statistics 

car sales
Credits: Medium

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Reportedly, as a result, car sales in the first ten months of this fiscal year have declined by 52% compared to the deals from the previous year (during the same time).

Meanwhile, there was no production of heavy vehicles (trucks and buses) in April. Some manufacturers also posted marginal sales in light commercial cars, pickups, and jeeps during April despite nil production.

But data from the Pakistan Automotive Manufacturers Association (Pama) mentioned negligible sales of some assemblers.

An official from Pama said:

I have never witnessed zero production and sales in auto history for an entire month and the situation looks the same for May, which is alarming for the auto sector.

In trucks, only Hino and Isuzu posted sales of 14 units and 22 units. As for busses, only Isuzu recorded sales in April, of just three groups, amid zero production. Jac and D-Max sold 6 and 11 units each in April under the LCVs, pickups and jeeps category.

Vendors Warn Lay-off

car vendors
Credits: The Pentagraph

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Furthermore, vendors have warned laying-off at least 20% of their workforce asides not paying salaries to workers for April and May. In contrast, the automakers are keen on keeping their workforce intact.

Previously, the automotive industry giants reportedly reached out to the government asking for help so that they can get through this difficult time.

Automotive manufacturers and assemblers are demanding a waiver on minimum turnover tax for greenfield projects, the removal of Federal Excise Duty (FED) on sales and reduction of sales tax on imports.

They also want the government to introduce special rate incentives from the State Bank of Pakistan (SBP) for plying new commercial vehicles to replace the older ones that will help save the environment as well.

Nonetheless, they are stressing that the government should shelve all other previous policies to provide them some relief.

We have now to see what the future holds for the auto sector.

Stay tuned to Brandsynario.

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