Passenger car sales increase by 62% in Nov

• Trend appears to be temporary, says auto sector expert.
• November sales decreased by 25% month-on-month.
• Auto sector showing promising signs, says expert.
  

Passenger car sales in the country increased by 62% on a year-on-year (YoY) basis in November 2024 compared to the numbers from November 2023, data from the Pakistan Automotive Manufacturers Association (PAMA) showed.

As many as 7,909 units were sold in November 2024. Whereas the number stood at 4,875 units sold during the same month last year, The News reported on Wednesday.

On a month-on-month basis, however, November sales decreased by 25% against the 10,557 units sold in October.

For the first five months of FY25 (July-November 2024), passenger car sales rose by 50% to 38,534 units against last year's 25,746 units.

Mashood Khan, an expert from the auto sector, said: "This positive sign brings some motivation for the industry as it steadily moves back on track. Projections suggest that January to June 2025 will perform better than the previous fiscal year, indicating a recovery in the sector".

However, these trends appear to be temporary when assessed for long-term sustainability. Key challenges, including domestic political instability and limited purchasing power among people, continue to restrict consistent growth. Despite these hurdles, the anticipated reduction in interest rates this month could provide much-needed relief to businesses and consumers alike.

Sales of 1300cc and above cars were recorded at 3,930 units, up 93% compared with November 2023 sales of 2,033 units. During this period, 1,000cc cars recorded sales of 381 units against 729 units during the same month last year. Below 1,000cc vehicles recorded a sale of 3,598 units, up 70% against 2,113 units in November 2023.

In November 2024, 63 units of Dewan Honri-Ve electric vehicle were also sold. Furthermore, speaking on the issue of electric vehicles (EVs), Khan said: "A notable development is the introduction of locally assembled EVs. While this represents a leap toward modernisation, these offerings seem tailored primarily for the elite class."

"Expanding access to EVs for the broader population would require manufacturers to target affordability for people. Besides this, the lack of infrastructure, particularly EV charging stations, remains a significant barrier to widespread adoption," he added.

The two-wheeler EV market holds substantial potential, especially if manufacturers can make prices accessible to the average consumer. This segment could serve as a transformative force in bridging affordability gaps and contributing to a more sustainable future, noted the expert.

As per Khan, the automotive sector was showing promising signs, but its sustained growth would depend on addressing these structural and economic challenges effectively and government support, he said.

The sale of buses and trucks increased to 328 units in November 2024 from 145 units in November 2023. The sale of jeeps and pick-ups increased to 2,191 units from 1,600 units sold during the same period in 2023.

Sales of tractors dropped to 3,428 units from 3,510 units in November 2023. Tractor sales faced a 50% decline in 5MFY25 to 10,367 units against 20,806 units during the same period last year.

Company-wise, Al Ghazi Tractors (AGTL) saw sales of 2,012 units, up 187% YoY and 584% MoM. While Millat Tractors (MTL) recorded sales of 1,416 units, down 50% YoY and 2.0% MoM in November 2024.

The sale of rickshaws and motorbikes increased to 120,484 units during November 2024 against 88,493 units in the same period in 2023. Expanding on the statistics, Myesha Sohail at Topline Securities said that MoM decline was mainly due to the end-of-year effect, as buyers delay deliveries/purchase of the car in a bid to get new year registrations.

Sazgar Engineering (SAZEW) saw the most significant MoM fall of 42% to 584 units in November 2024, while production of SAZEW remained almost flat (down 1.0%) on MoM basis at 993 units. Indus Motor Company saw a decline of 13% MoM to 2,194 units in November 2024. While on a YoY basis, the company reported an increase of 129%, led by a significant jump in Toyota sales.

Pakistan Suzuki Motors Company recorded sales of 5,374 units, a 53% YoY rise while a simultaneous 26% MoM fall. Honda Atlas Cars recorded sales of 1,112 units, up 10% YoY while recording a 27% MoM fall.

Hyundai Nishat Motor saw an 11% YoY increase and a 21% MoM rise to 724 units in November 2024, making it the only company to report a MoM rise during the month, led by a 45% jump in Tucson sales.

"Going forward, we expect sales to post strong growth from January 2025 owing to a recovery in auto finance amidst falling interest rates. While in December 2024, we may see some decline MoM owing to the year-end impact," said Sohail.