-Pak Suzuki Outperform in March, while Disappointing sales for Honda
The Auto Sales witnessed a slight recovery posting a growth of 2% YoY (up 16% MoM) taking July’18 to Mar’19 sales decline to 4% YoY.
The monthly increase in sales was due to an increase in Light Commercial Vehicles (19% YoY) while Jeeps Sales decreased by 53% YoY, restricting the overall upside.
In the small car segment, the 1,000cc segment rose above the market with a 39% YoY growth. However, tractors/trucks/ buses sales significantly declined by 25/ 55/ 25% YoY respectively.
Pak Suzuki Outperforms in March
Pak Suzuki Motors (PSMC) witnessed a sales growth of 23% YoY, capitalizing on the increased demand for Bolan, Wagon R and Ravi which increased by 38%/63%/36% YoY respectively. Sales of Mehran showed an increase of 1% YoY and 35% MoM as the company plans on abandoning the brand. Alto is expected to replace the decades-old model at a higher starting price. The prime reason for the increase in PSM Sales is Restrictions on imports of used Cars, mainly consisting of low-end Japanese cars, thus further giving a push to Low-End car sales.
Not a Good Month for Indus Toyota
Toyota Indus(INDU) sales declined 11% YoY due to a massive decrease in sales of Fortuner and Hilux by which decreased by 63% and 65% YoY respectively. Significant Rupee depreciation and imposition of FED raised Fortuner and Hilux prices. However, Corolla showcased a 2% increase in sales due to the significant price difference between Corolla and Civic.
However, future prospects for Indus Toyota looks promising. INDU is currently undertaking Capacity expansion which is expected to increase the capacity to 75,000 cars annually. Furthermore, company is planning to launch Toyota Vios after expansion which is expected to increase the profitability as Gross margins will rise.
Largest Sales decline for Honda
Honda Atlas Cars (HCAR) witnessed the largest decline in sales volume as it decreased by 29% YoY taking 9MFY19 decline to 8% YoY. In March 2018, Sales volume of Civic and City decreased by 26% YoY, while BR-V’s sales decreased significantly by 47% YoY. Apparently, Imposition of 10% FED on cars above 1,700CC led to declining in Civic Sales. Honda Civic contributes 40% to total sales of HCAR. However, the market is anticipating removal of FED while 10th generation Model of Honda Civic is expected to be launched soon which may lead to an eventual increase in sales volume.