- The trend appears temporary, says an automotive sector expert.
- November sales were down 25% month over month.
- The automotive sector is showing promising signs, according to an expert.
Passenger car sales in the country increased by 62% on a year-on-year (YoY) basis in November 2024 compared to November 2023 figures, according to data from the Pakistan Automobile Manufacturers Association (PAMA).
As many as 7,909 units were sold in November 2024. While this number stood at 4,875 units sold in the same month last year, News reported Wednesday.
However, on a monthly basis, November sales were down 25% from the 10,557 units sold in October.
In the first five months of FY25 (July-November 2024), passenger car sales increased by 50% to 38,534 units compared to 25,746 units last year.
Mashood Khan, an auto sector expert, said: “This positive sign provides some motivation to the industry as it gradually gets back on track. Projections suggest that from January to June 2025, results will be better than the previous financial year, indicating a recovery in the automotive sector. the sector”.
However, these trends appear temporary when assessing their long-term sustainability. Major challenges, including domestic political instability and limited purchasing power of citizens, continue to hamper consistent growth. Despite these hurdles, this month’s expected interest rate cut could provide much-needed relief to businesses and consumers.
Sales of cars 1,300 cc and above were recorded at 3,930 units, up 93% from November 2023 sales of 2,033 units. During this period, 1,000 cc cars recorded sales of 381 units compared to 729 units in the same month last year. Vehicles under 1,000 cc recorded a sale of 3,598 units, up 70% from 2,113 units in November 2023.
As of November 2024, 63 units of the Dewan Honri-Ve electric vehicle have also been sold. Further, speaking on the issue of electric vehicles (EVs), Khan said, “A notable development is the introduction of locally assembled electric vehicles. Although this represents a step towards modernization, these offerings seem primarily aimed at the elite class.
“To expand access to electric vehicles to a wider population, manufacturers would need to target affordability for people. Additionally, the lack of infrastructure, particularly electric vehicle charging stations, remains a significant barrier to widespread adoption,” he added.
The market for two-wheeled electric vehicles holds considerable potential, especially if manufacturers manage to make prices accessible to the average consumer. This segment could serve as a transformative force by closing affordability gaps and contributing to a more sustainable future, the expert noted.
According to Khan, the automotive sector is showing promising signs, but its sustainable growth will depend on effectively addressing these structural and economic challenges and receiving support from the government, he said.
Sales of buses and trucks increased to 328 units in November 2024 from 145 units in November 2023. Sales of jeeps and vans increased to 2,191 units from 1,600 units sold during the same period in 2023.
Tractor sales fell to 3,428 units from 3,510 units in November 2023. Tractor sales faced a 50% decline during 5MFY25 at 10,367 units compared to 20,806 units during the same period last year .
At the corporate level, Al Ghazi Tractors (AGTL) recorded sales of 2,012 units, up 187% year-on-year and 584% month-on-month. While Millat Tractors (MTL) recorded sales of 1,416 units, down 50% year-on-year and 2.0% month-on-month in November 2024.
Sales of autorickshaws and motorcycles increased to 120,484 units in November 2024 from 88,493 units during the same period in 2023. Elaborating on the statistics, Myesha Sohail of Topline Securities said the monthly decline was mainly due to to the end-of-year effect, as buyers delay car deliveries/purchases in an effort to obtain new year registrations.
Sazgar Engineering (SAZEW) saw the largest MoM decline of 42% to 584 units in November 2024, while SAZEW’s production remained almost flat (down 1.0%) on a MoM basis at 993 units. Indus Motor Company witnessed a 13% month-on-month decline to 2,194 units in November 2024. On a year-on-year basis, the company reported an increase of 129%, driven by a significant increase in Toyota sales.
Pakistan Suzuki Motors Company recorded sales of 5,374 units, an increase of 53% year-on-year and a simultaneous decline of 26% month-on-month. Honda Atlas Cars recorded sales of 1,112 units, up 10% year-on-year, while recording a decline of 27% month-on-month.
Hyundai Nishat Motor saw an 11% YoY and 21% MoM increase to 724 units in November 2024, making it the only company to report a MoM increase during the month, driven by a 45% increase in Tucson sales.
“Going forward, we expect sales to show strong growth from January 2025 onwards due to a recovery in auto financing amid falling interest rates. In December 2024, we may see to some decline month-on-month due to year-end impact,” Sohail said.