In a piece of good news from the local auto industry of Pakistan, Indus Motors Company on Monday posted numbers celebrating the highest ever monthly sale of vehicles in July.
On a Facebook post, the company wrote, “Every day is a new celebratory moment at Indus Motor Company as we achieve yet another milestone – highest ever sales in a month since its inception with 6,775 units sold. Thank you everyone for being our constant support!”
This shows an increase in the demand for cars in Pakistan.
Meanwhile, Minister for Information & Broadcasting Ch. Fawad Hussain took this moment to take a shot at his political opponents, by quoting Toyota Pakistan’s tweet with the hashtag, “MehgayiBohatHai”.
However, this tweet by the federal minister wasn’t taken well by the majority of the netizens as people were quick to remind him that this statistic in no way represents the economic conditions of the majority of people in the country.
Meanwhile, Tribune’s Economic Correspondent Shahbaz Rana was quick to point out that this increase was due to the low interest rates in the economy, leading to an increase in car financing, and that the government should be work to continue this policy.
Chaudhry sb people are taking benefit of low interest rates. The low interest rates must continue for continuing the momentum. Rupee devaluation may erode low interest environment benefits as the car assemblers may try to increase prices. Authorities need to be vigilant sir.
— Shahbaz Rana (@81ShahbazRana) August 2, 2021
Suzuki record sales
Toyota is not alone in achieving a milestone over the last month. According to the media outlet ProPakistani, Pak Suzuki Motor Company (PSMC) has recorded the highest ever sales in the history of Pakistan’s Auto industry in a month.
Read More: Pakistan set to launch car financing at 5% interest rate?
Reportedly, the company has closed July 2021 with over 15,200 vehicle sales.
The reports show that, currently, PSMC holds a lead over other manufacturers with a 66 percent share in the automotive sector and PSMC has sold 37,730 units of its Alto in the 2020-21 fiscal year, meaning low competition in the market is one of the major reasons along with the increased interest rates.
These arguments of car financing increasing sales are supported by the increased car financing data for the month of June.
Auto Financing for June 2021
Car Financing in Pakistan saw a historic high as the number reached Rs308 billion for the month of June. The lower cost of borrowing and the increased buying options for the local people are arguably the two most important factors in this regard.
According to the recently released State Bank of Pakistan (SBP) data, the car financing for the consumers has increased 46 per cent from Rs211 billion worth of borrowing in June of the preceding year. Compared to the latest pre-pandemic period of FY19, car financing saw an increase of 43 per cent in June 2021.
The industry experts have predicted that car sales would increase further due to the incentives offered by the government in the recent budget and the upcoming auto policy 2021.
Another major factor in this is the good policy rate being offered by the government. Despite high prices of locally-assembled cars over the last 18 months followed by late deliveries and high premiums, buyers remained upbeat to cash in on the opportunity of a low-interest rate of 7pc which was 13.5pc in March 2020.
Read More: Pakistan’s auto financing reaches historic high at Rs308bn in June