LAHORE: Atlas Honda has introduced their second price increase for 2023 two weeks after their previous price increase on February 1. The new prices are as follows:
“It is a mix of factors. Today’s tax increases, the increases on completely knocked-down (CKD) kit duty, and the 1% increase in sales tax are the reasons,” Muhammad Sabir Sheikh, Chairman of the Association of Pakistan Motorcycle Assemblers (APMA), tells Profit.
The price increase marks the fifth price increase by Atlas Honda for FY23. The price increases have led to a 23% Year-on-Year (YoY) decrease in Atlas Honda’s 7MFY23 sales as its current 612,817 units sold trail by 185,840 units behind the 798,657 units it sold over the same period last year based on sales data provided by the Pakistan Automotive Manufacturers Association (PAMA)
The fall in sales has resulted in a Rs 431.5 million dip in profits across Q1FY23 and Q2FY23 compared to the same period last year. However, the price increases have mitigated the losses that Atlas Honda could have incurred. Honda Atlas’ sales across Q1FY23 and Q2FY23 also amount to a 23% dip, but they have only reduced their net earnings by 16% over the same period compared to last year based on their quarterly earning reports.
Furthermore, despite the price increases, Atlas Honda retains its dominance across the two-wheeler market. The company accounts for 85% of all sales in the two-wheeler market based on the 7MFY23 sales figures provided by PAMA. Looking ahead, Sheikh tells Profit to expect further price increases by Atlas Honda, “Maybe a little more due to increase in taxes”. Sheikh also tells Profit that he expects these price increases to happen, “immediately”.
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