KARACHI: Despite a grim economic picture, the auto sector seems to have found some relief as Honda and Indus Motor Company (IMC) saw a massive increase in sales in January 2020.
Honda’s saw a 120 per cent increase in sales as 2,210 units were sold in the first month of 2020 compared to 1,005 units sold in December 2019. Similarly, IMC’s sales increased by 72 per cent as it went from selling 2,332 units in December 2019 to 4,022 units in January 2020.
However, Pak Suzuki’s sales declined despite the fact that it is currently the largest player in the auto sector. Its sales decreased by 36 per cent as it went from selling 8,732 units in December 2019 to 5,555 units in January 2020. Other than the sales of the Suzuki Cultus, every other vehicle, including WagonR, Alto, Swift and Ravi saw a decline in sales.
Explaining the situation, AKD Securities’ Investment Analyst Shahrukh Saleem said that the decrease in sales is due to the depleting demand for LCVs in January 2020. “The company announced that it would increase the prices of its cars from January 2020, which led to higher than usual pre-bookings in December 2019. The price of Suzuki Cultus, however, was increased on January 31, 2020, which explains why its sales grew by 85 per cent,” he added.
Nissan Gandhara is another major contributor to the slight improvement in the auto sector’s performance in the first month of 2020. Its sales went up from 176 units sold in December 2019 to 253 units in January 2020, recording an increase of 47 per cent.
Despite the temporary respite, Standard Capital Securities suggests, the sales cannot match the figures from FY17-18 because of the current economic outlook, though the increasing sales may carry some of the momenta for a few months.