Car sales in FY24 drop to 15-year low in Pakistan

Car sales in Pakistan dropped to a 15-year low in fiscal year 2023-2024, according to data shared by the Pakistan Automotive Manufacturers Association (Pama) on Wednesday.

A total of 103,827 cars, including LCVs, vans, and jeeps were sold in FY24 compared to 126,879 in FY23 — a decline of 18% — and the lowest in 15 years.

Brokerage house Topline Securities attributed this decline to rising car prices, expensive financing, and low purchasing power of consumers.

However, car sales in June — the fiscal year’s last month — were up 120% compared to June 2023. Data showed 13,284 cars were sold last month compared to 6,034 in June last year.

Topline Securities said the figure was the highest in 18 months. Last June, car sales had dropped as automotive manufacturers temporarily closed down their plants.

The closures had come after Pakistan’s central bank shut down imports because of a financial crunch.

The brokerage house expects car sales to pick up in the new fiscal year as the economic situation improves, rupee remains stable, and the interest rate is reduced further.

Another brokerage house, ASDL, also said it expects positive growth in auto sales in the current fiscal year depending on interest rate cuts and currency stability.

Meanwhile, 1.12 million bikes were sold in FY24 compared to 1.16 million last year, showing a decline of 4%. This decline was also attributed to reduced purchasing power amid record inflation.

On the other hand, sales of tractors were up 47%. The total number of tractors sold in FY23 was 30,942. This year, the figure rose to 45,494.

According to Topline, tractor sales went up this year as the agriculture sector recovered from FY23’s devastating floods.