Honda Atlas Car (Pakistan) Limited Wednesday announced to enhance prices of its all Model Cars up to Rs 80,000 to Rs 100,000 from August 10, 2020.
The main reason behind this increase is the depreciation of the rupee vs dollar, the company said. “Due to current forex situation, it has become difficult for the company to further absorb exchange rate impact and compel to consider some part of its impact in price,” the company announced in a circular issued for the local dealers.
These prices are ex-factory per unit inclusive of 17 per cent sales tax and 5 per cent FED on all Honda CKD variants, it added.
Consignee stock can be converted on current price till 8th August 2020, after that new price will be applied, the company said.
The Central Bank has reduced the Policy Rate by 6.25% to 7.0% over the last five months, which has resulted in commercial banks revising their car financing schemes to more favorable terms for the consumers. Historically, car financing accounts for 35-45% of the overall sales, which goes beyond 45% in a low interest rate scenario, analysts said.
The market sources reveal that delivery periods of Honda models range in between 1-5 months, while ‘on’ money (premium paid over list price) has also increased to Rs 100,000 – Rs 500,000 (5-10% of list price) for receiving immediate deliveries of vehicles.
According to market analysts, car sales will increase by 5-8% for FY21E-FY23F. In absolute terms, car sales of the industry to clock in at 169,231 (+35% YoY), 216,890 (+28% YoY) and 253,150 units (+17% YoY) during FY21E, FY22F and FY23F, respectively (including KIA, Hyundai and imported).