Booming sales Tractor industry flourishing
KARACHI: Tractor industry recorded booming production and sales in February 2012 while heavy vehicle segment continued to face laggard sales. Pick-ups, two- and three-wheeler sales also posted positive growth.
Al Ghazi (Fiat) produced and sold 2,121 and 3,571 units in February as compared to 4 and 204 units in January respectively.
However, the overall sales of Fiat tractors in July-February 2011-2012 fell to 7,436 units as compared to 18,005 units.
According to figures released by Pakistan Automotive Manufacturers Association (PAMA), Millat Tractor (Massey Ferguson) produced and sold 3,606 and 5,335 units in February as compared to 1,453 and 165 units in January.
Sales in July-February 2011-2012 dropped to 14,505 units as compared to 27,514 units in the same period of last fiscal year.
Farmers/growers resumed their tractor buying activity after reduction in general sales tax (GST) on farm machinery to five from 16 per cent coupled with decision to resume loaning facility by Zari Taraqiati Bank.
The tractor industry suffered the most difficult period from July 2011 to January 2012 in terms of sharp decline in sales and production as growers/farmers became reluctant to lift tractors after the imposition of 16 per cent GST in April 2011.
The government finally reduced the GST to five per cent on January 20, 2012 and later issued an SRO which also helped in clearing of thousands of unsold tractors parked at the factories and countrywide dealership networks.
General Manager Sales and Marketing Balochistan Wheels Limited Shaikh Mohammad Iqbal told Dawn that Millat Tractors had planned to produce 5,000 tractors each in March, April and May followed by 3,000 tractors each by Al Ghazi in the next two months.
These companies had issued firm and tentative requirements of parts to their vendors. He added that Millat Tractors had also started double shift to meet the burgeoning demand.
He said that the government had sanctioned Rs6.9 billion to the ZTBL for distribution of loans to the agriculture sector.
He added that PAAPAM had urged its members in the last week’s meeting in Lahore to streamline their production of parts and accessories.
In heavy vehicles, truck sales (Hino, Nissan, Master and Isuzu) plunged to 1,460 units from 1,784 units while bus sales (Hino, Nissan, Master and Isuzu) fell to 302 units from 340 units.
A leading Japanese heavy vehicle assembler said that institutional buying of buses was below normal. Commercial operators of buses also backed off after meteoric price in bus chassis after imposition of 16 per cent GST in July 2011 coupled with impact of losing value of the rupee against the dollar which further pushed up prices.In trucks, besides impact of high price on account of 16 per cent GST, the arrival of smuggled trucks in the markets lured many new buyers due to low price while demand for new trucks was also hit by suspension in NATO supplies to Afghanistan. However, Korean and Chinese made trucks benefited due to their low price.
In pick-ups, Suzuki Ravi and Toyota Hilux sales increased to 10,739 and 2,561 units in July-February 2011-2012 as compared to 9,903 and 1,374 units.
Two wheelers sector also performed well. Sale of Honda and Suzuki bikes reached 384,801 and 14,404 units as compared to 356,997 and 13,103 units. Qingqi and Habib bike sales 2,003 and 17,865 units as compared to 1,892 and 12,946 units.
Saazgar three wheeler sales grew to 11,791 from 10,522, while Qingqi three wheeler sales improved to 14,946 from 10,058 units.