Car sales surge 118pc in October

KARACHI: Passenger car sales among members of the Pakistan Automotive Manufacturers Association (PAMA) surged by 118 per cent year-on-year in October 2024, reflecting an improvement in purchasing power, according to data released on Monday.

PAMA data shows that passenger car sales reached 10,557 units in October 2024, a significant increase from the 4,850 units sold in October 2023.For the first four months of fiscal year 2025 (4MFY25), passenger car sales grew by 47 per cent, reaching 30,625 units compared to 20,871 units in the same period last year. October sales also registered a 35 per cent month-on-month increase from 7,794 units in September 2024.

According to Mashood Ali Khan, an auto industry expert and former chairman of the Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM), this growth trend is visible across the car, truck, and motorcycle sectors, with hopes for an uptick in the tractor industry in the coming quarter. “Interest rates have decreased from July to October, boosting consumer confidence and increasing the potential for car financing. Some Original Equipment Manufacturers (OEMs) have also introduced interest-free financing options for customers, which has bolstered sales,” he noted. However, there is still a gap in affordable models for the lower middle class, he added, saying, “The industry benchmark of 250,000 units for the year may not be achieved.”

Khan further pointed out that while local parts manufacturers stand to benefit from established Japanese auto companies due to increased localisation, the entry of new players with limited localisation may not yield similar benefits for the local parts industry.

Myesha Sohail of Topline Securities attributes this surge to favourable auto financing and an overall improvement in market optimism and stability. She predicts that auto sales will continue to climb as interest rates decline further and new models, particularly hybrid electric vehicles (HEVs) and electric vehicles (EVs), become available in the market.

In the segment of 1,300cc and above vehicles, sales rose by 153 per cent to 3,997 units from 1,580 units in October 2023 and saw a 5.0 per cent increase from September 2024’s 3,792 units. Sales of 1,000cc cars reached 569 units, a minor increase from 525 units last October. Vehicles under 1,000cc reported a 118 per cent jump in sales, totalling 5,991 units compared to last year’s 2,745 units.

The sale of buses and trucks increased to 351 units in October 2024, more than doubling from 174 units in October 2023 and showing a month-on-month (MoM) rise from 319 units in September. Sales of jeeps and pickups also climbed to 2,551 units, up from 1,330 units the previous year, with MoM growth recorded as well.

Among specific automakers, Sazgar Engineering posted the most notable year-on-year growth, with a 296 per cent increase in October 2024, and a 21 per cent MoM increase, totalling 1,002 units – the company’s highest recorded sales to date. Pakistan Suzuki Motor Company saw a 40 per cent MoM rise and an 85 per cent year-on-year increase, reaching 7,040 units in October 2024. Sales of PSMC’s Alto model also soared, with an 80 per cent year-on-year and 49 per cent MoM increase, fuelling the overall rise in PSMC sales.

Indus Motor Company recorded sales of 2,532 units, reflecting a 142 per cent year-on-year rise and a 7.0 per cent MoM gain, while Honda Atlas Cars (HCAR) saw its sales jump to 1,514 units, up 230 per cent year-on-year and 19 per cent MoM. Hyundai Nishat Motor recorded a 34 per cent year-on-year growth, although it posted a 26 per cent MoM decline with 504 units sold in October.

In the motorcycle segment, sales of two- and three-wheelers increased by 35 per cent year-on-year and 5.0 per cent MoM, totalling 137,693 units in October 2024, marking the highest monthly sales in 28 months. Improved purchasing power due to lower inflation contributed to this growth.

Conversely, the tractor industry recorded a decline, with total sales down 67 per cent year-on-year to 1,733 units, though the sector saw a 61 percent MoM increase. Millat Tractors reported a drop of 52 per cent year-on-year but a 94 per cent MoM rise with sales of 1,439 units, while Al Ghazi Tractors saw sales of 294 units, an 87 per cent year-on-year decline and a 12 per cent MoM decrease.