Auto industry in crisis car sales expected to fall by 30%

Auto industry in crisis, car sales expected to fall by 30%

Lahore (NNI) Uncertainty following increase in holding tax on filers and non-filers, imposition of 1% capital value tax on vehicles over 1300 cc and strict auto financing rules to reduce demand and high interest rates. In view of the situation, the auto industry expects a 30% decline in car sales in 2023-22.

According to market sources, car prices are likely to rise after Eid-ul-Adha as the industry will pass on the effects of the rupee’s continued depreciation against the dollar and high shipping prices to consumers, while many believe the industry is in a crisis. Is passing

It may be recalled that Indus Motor Company has already stopped advance booking of vehicles from May 18, followed by Lucky Motor Corporation Limited from May 20, Pecanto Automatic & Sportage and Pak Suzuki Motor Company Limited from July 1. Is. This is due to the exchange rate crisis and the decision of the SBP not to allow opening of Letters of Credit for import of spare parts and accessories from May 20, 2022. Assemblers Rising fuel prices, SBP restrictions on opening LCs for auto parts and new taxes imposed from July 1 are expected to reduce car sales by at least 30 per cent in FY2023. “We have to raise prices because there is no other way,” he said.

According to auto industry insiders, the effects of various tax hikes, rising interest rates, car prices, petrol and diesel price hikes, LC restrictions, and reduced consumer financing period have affected car sales in September 2022. Assemblers are currently optimistic about advance bookings for cars, jeeps, SUVs and orders were placed a few months ago which will be delivered in the next few months. About 26% of sales are from auto financing, while consumer financing accounts for 35% of Pak Suzuki’s total sales.

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