Auto sector sees recovery despite costly financing

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KARACHI: While the Economic Survey FY24 paints a dismal production picture, the local assemblers must be jubilant since sales of cars, light commercial vehicles (LCVs), jeeps, and pickups in May 2024 touched a 17-month high at 10,949 units, showing a jump of 100 per cent year-on-year and 4pc month-on-month.

A drop in prices in some variants helped assemblers witness a recovery in sales despite expensive auto financing due to the monetary policy rate of 22pc. Notwithstanding the impro­vement, the drop in sales of cars, jeeps, vans and pickups during 11MFY24 stood at 25pc to 90,542 units versus 120,845 in the same period last fiscal year.

Total tractor sales rose by 48pc to 41,360 units during 11MF24 from 27,952 in the same period last fiscal year. Sunny Kumar of Topline Securities attributed the 100pc YoY rise in car, jeep, vans, and pickup sales to a low base from last year amid plant shutdowns and the steep rise in tractor sales to the low base of last year amid floods.

Two-wheeler sales during 11MFY24 fell by 4pc to 1.04m units from 1.09m in the same period last fiscal year, while three-wheeler sales clocked in at 21,778 from 18,098, up by 20pc.

Truck and bus sales were also up 8pc MoM and 61pc YoY to 247 units in May 2024.

Published in Dawn, June 12th, 2024

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