Car Sales Plunge 36% MoM in July 2024

Staff Report:Car sales in Pakistan fell by 36% month-on-month (MoM) in July 2024 due to pre-buying in June 2024, as reported by PAMA. Total car sales for July 2024 amounted to 8,589 units, which represents a 60% year-on-year (YoY) increase despite the monthly decline.

The MoM decline in car sales can be primarily attributed to an increase in tax rates for vehicles, specifically Withholding Tax (WHT), introduced in the FY25 budget. This led to a surge in pre-buying in June 2024, resulting in an 18-month high for that period.Car Sales in July 2024 Slump by 32% Month-on-Month

Hyundai Nishat Motor experienced the most significant MoM drop, with sales of 529 units—a decrease of 50% MoM and 7% YoY. Indus Motor Company (INDU) recorded sales of 1,664 units in July 2024, reflecting a 44% decline MoM. Honda Atlas Cars (HCAR) reported sales of 931 units, down 15% MoM, while Sazgar Engineering (SAZEW) saw a smaller decrease, with 825 units sold, marking a 5% MoM decline.

The YoY increase in car sales during July 2024 is attributed to a low base effect due to the closure of plants caused by inventory shortages.

In the motorcycle segment, Pakistan’s two-wheelers and three-wheelers sales decreased by 5% MoM but increased by 15% YoY, totaling 84,993 units in July 2024. Atlas Honda (ATLH) recorded sales of 70.3K units, reflecting a 12% MoM decline but a 13% YoY increase.

In the tractor segment, Millat Tractors (MTL) saw sales of 605 units, down 63% YoY and 78% MoM. Al Ghazi Tractors (AGTL) recorded sales of 855 units, down 16% YoY and 40% MoM in July 2024. This brings total tractor industry sales to 1,460 units, a decrease of 45% YoY and 65% MoM. The sharp fall in tractor sales is also attributed to pre-buying in June 2024, as the government imposed a 10% General Sales Tax (GST) on tractor sales.

Truck and bus sales increased by 3% MoM and 57% YoY, reaching 307 units in July 2024.