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Sunday, May 26, 2024

Prompting riots: Honda raises bike prices

News Analysis |

In what seems like an endless punishment for Pakistani consumers, Atlas Honda Limited (AHL) has increased bike prices, yet again, by Rs500-3,000 due to the devaluation of the rupee against the dollar despite achieving over 90 percent localization. This is the second trajectory in Bike prices and fourth for overall vehicles by the Honda franchise, since Atlas Honda is co-owned by Honda Pakistan. 

The company increased the price of CD-70 after a gap of three years by Rs 500 to Rs 64,000. The new price of CD-70 Dream and Pridor is now fixed at Rs 68,500 and Rs88,000, up Rs1,000 while the price of CG-125 has been raised by Rs 1,500 to Rs 109,000.

CG-125 Delux and CB-150 will now cost Rs129,500 and Rs165,000 from April 2, 2018 after a jump of Rs 3,000 per bike. Surprisingly, Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) on its website claimed that 92pc localisation has been achieved for bikes.

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Overall import bill for completely- and semi-knocked down kits of two wheelers rose to $69 million from $56m in same period last fiscal, up by 23pc. Atlas Honda is expected to achieve sales of 1.1 million units by end of its financial year ending March 31, while it aims to hit sales of 1.3m bikes in its next financial year, a Honda dealer told a local publication.

He said improvement in law and order situation in Karachi has boosted the overall sales of Honda bikes to over 50,000 units per annum. The sales hovered around 10,000-12,000 units some three years back due to lawlessness in the mega city. Lack of public transport has also pushed up demand of two-wheelers.

The dealer said the share of Honda 70cc in company’s overall sales ranges between 42-45pc followed by 40pc market share by 125cc. Only last month, Honda Atlas Cars Ltd (HACL), following the trend against its only two existing competitors Suzuki and Toyota, had raised the prices of Honda Civic and City by Rs100,000 and BRV by Rs20,000 following devaluation of the rupee against the dollar. It had raised prices in January by Rs 50,000-60,000, resulting in public outrage, global village space had earlier reported.

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This is, of course, not a first increase in the prices of these vehicles. The trio has been increasing prices in this fashion for the past few months and in the very first quarter; there have been multiple increments per brand. Pak Suzuki had earlier raised the price in January by Rs 10,000-20,000 and by another Rs 20,000-50,000 this month, GVS earlier reported. Pak Suzuki Motor Company (PSMC) has jacked up the already raised prices of its variants by up to Rs 50,000, effective from March 1st, 2018, which marks the second time the automaker has revised rates in an upward trajectory this year alone, before even hitting the second quarter.

Hardly two months prior the company had raised prices in the range of Rs 10,000-Rs 20,000 in a balancing act against the depreciating rupee. With continuously devolving quality and increasing prices of vehicles against external factors, vehicle manufacturers are testing a large group of enthusiasts and consumers.