Karachi, May 16, 2022 (PPI-OT): Pakistan Autos: Seasonal decline in Ramazan
The total industry sales in Apr’22 clocked in at 27,669 vehicles (+25%YoY/-17%MoM), consisting of 18,625 passenger cars (+29%YoY/-18%MoM), 3,745 LCVs (+34YoY/-14% MoM), and 397 trucks (+41%YoY/-21%MoM). The decline in volumes is attributed to the general slowdown in Ramadan hours and production halts due to Eid holidays.
10MFY22 total industry sales clocked in at 279,329 units (+42%YoY), consisting of 191,235 passenger vehicles (+51%YoY), 36,499 LCVs (+44%YoY) and 4,659 trucks (+56%YoY). The volumes continued to remain strong (although at a declining growth rate), especially passenger vehicles whose numbers have exceeded the previous high of 183k units in 10MFY18. The effect of stimulus provided in FY22 budget continues to persist by looking at the order books despite the reversal through supplementary finance bill.
Segment-wise, the 1,300cc+ premium segment emerged victorious, posting growth of 34%YoY followed by 1,000cc segment, growing 29%YoY and 800cc segment witnessing growth of 21%YoY. On the flipside, volumes shrank on MoM basis in which the 800cc segment contracted 47%MoM. 1,000cc segment remained in the limelight owing to a growth of 48%MoM while 1,300cc+ segment remained flat. In 10MFY22, the volumes of 800cc/1,000cc/1,300cc+ segments have depicted a growth of 70/61/35%YoY.
Amongst major OEMs, INDU posted highest sales of 5,775, declining 18%MoM owing to the high-base effect after posting highest ever monthly sales in previous month. Similarly, PSMC/HCAR posted sales of 12,639 units (-16%MoM)/2,629 units (-28%MoM). On YoY basis, INDU/PSMC/HCAR have posted growth of 8/47/15%YoY.
On the macro perspective, we believe that the euphoria (post budgetary measures) has finally come to an end. The price decreases during Jul’21 had initiated a buying spree before the prices were reverted which had filled the order books. With prices increasing 20-30%YoY across the board, we expect the industry to slowdown going forward. Additionally, the 250bps hike by SBP will discourage the growth in auto loans.