Pakistan Market: Drops Below 140,000 Units in 2014; Levelling Off Is Expected for 2015
- Pakistan's automobile (PC+UV) market dropped below 140,000 units in 2014, a slight decrease compared to the previous year. Economic conditions began to improve after the country's new Prime Minister Nawaz Sharif took office in May 2013. While sales of new commercial vehicles are on the rise, new passenger vehicles are sluggish due to increasing sales of used models.
- In the first 10 months of 2014, automobile sales volume fell 0.5 percent compared to the same period of 2013 to 123,000 units.
In the first half of the year, the expansion of the used automobile market and tax increase of models with engine displacement of l,800cc or larger resulted in continued negative growth of passenger vehicles. However, in the second half of 2014, both passenger and commercial vehicles were posting double-digit growth. In the first quarter of fiscal 2014 (July-September 20I4), Punjab state's decision of purchasing 50,000 Suzuki models for a youth program and budget announcement for fiscal 2014 are anticipated to improve economic conditions, positively influencing consumer confidence. In addition, an average of 10 percent tax increase on used automobiles and the exemption of locally-made automobiles from a 10 percent FED (federal excise duty) are expected to boost new automobile sales.
In the first half of the year, the expansion of the used automobile market and tax increase of models with engine displacement of l,800cc or larger resulted in continued negative growth of passenger vehicles. However, in the second half of 2014, both passenger and commercial vehicles were posting double-digit growth. In the first quarter of fiscal 2014 (July-September 20I4), Punjab state's decision of purchasing 50,000 Suzuki models for a youth program and budget announcement for fiscal 2014 are anticipated to improve economic conditions, positively influencing consumer confidence. In addition, an average of 10 percent tax increase on used automobiles and the exemption of locally-made automobiles from a 10 percent FED (federal excise duty) are expected to boost new automobile sales.
- In 2015, a new Auto Industry Development Program is expected to aid market recovery. The growing infrastructure demand is expected to maintain brisk sales of commercial vehicles; however, concern over tax increase regarding passenger vehicles is projected to level off overall automobile sales volume.
Contact us: info@inovev.com