KARACHI: Ban on non-filers to buy vehicles, rising diesel prices, falling rupee value and increasing auto financing rates have caused a decline in truck sales in 4MFY19 due to massive decrease in Hinopak’s volumes. However, substantial jump in Isuzu bus sales slightly lifted the overall bus sales figures.

Hinopak’s truck sales plunged to 853 units in 4MFY19, from 1,224 units in same period last year, followed by a meagre fall in bus sales to 124 units from 140 units. This brought down the average per month sales of the company (trucks and buses) to 244 units, from 341 units last year.

Similarly, Isuzu’s truck sales fell to 1,099 units in 4MFY19, from 1,169 units in corresponding period last year while the bus sales jumped to 95 units as against 17. The overall average monthly sales edged lower to 352 units, from 357.

Some heavy vehicle assemblers had pushed up the prices by 5-10 per cent owing to the rupee devaluation against the dollar while others either kept their rates pegged or offering discounts.

As per the new figures, the restriction on non-filers to buy vehicles has not hit Isuzu hard as compared to competitors. For instance, Master truck sales plunged to 401 units in 4MFY19, from 506 units, followed by a drop in bus sales to 91 from 102 units.

Ghandhara Industries Ltd (GNL) General Manager Marketing and Sales Badar Mir said cargo market (goods carriers) had observed descending trend in the last three to four months. The government had imposed the ban on non-filers, assuming that it would bring positive changes to country’s economy besides enabling the government to generate more revenue.

He said high exchange rates pushed up the rates of trucks and buses by 5-10pc. Additionally, higher bank leasing rates and rising prices of diesel compared to less income also hit the sale, he added.

The Oil and Gas Regulatory Authority (Ogra) has given the time limit to oil marketing companies (OMCs) up to 2019 to standardise the trucks/prime movers according to Ogra criteria. “Oil transporters due to these restrictions are selling their old vehicles in cargo market which is also affecting new truck sales,” Mir said.

He said customers may prefer Chinese vehicles due to high-priced Japanese products.

Besides, oil pipeline from Karachi to Machike near Lahore (covering central Pakistan including Bubak, Shikarpur, Fazilpur, Mehmood Kot near Multan and Faisalabad) would reduce at least 3,000-4,000 oil transportation vehicles on roads which may cause a drop in sales of prime movers in future, he feared. Bus sales have improved due to orders from academic institutions and government departments, he noted.

On the other hand, six-wheeler and 10-wheeler oil transportation truck sales would increase in central Pakistan for small distance transportation, he added.

“Isuzu has emerged as the market leader in the last seven months, beating its Japanese counterpart Hinopak,” Mir claimed, while referring to the sales figures of Pakistan Automotive Manufacturers Association.

The truck segment, considered as a barometer of trade, enjoyed boom from 2013-14 to 2017-18 while bus assemblers witnessed robust demand from 2011-12 which continued till 2016-17.

A Hinopak Motors Ltd official said despite the fact that prices of various products are under pressure, owing to 30pc devaluation against the dollar since December 2017, “our company has not passed on the impact of rupee-dollar parity to commercial vehicles as this segment is very much price sensitive.”

He said the company is absorbing exchange rate impact, which is another blow being faced by the industry.

Because of the ban on purchase of vehicles for non-filers and rupee depreciation, he said “on an average our sales dropped by 30pc during first four months of the current fiscal year.” In FY18, Isuzu sold 3,878 trucks and 122 buses versus Hinopak’s 3,874 trucks and 334 buses.

In FY17, FY16 and FY15, Hinopak was the top seller of trucks with sales of 3,024, 2,458 and 1,510 units as compared to 2,640, 1,398 and 938 units by Isuzu.

In buses, Hino sold 709 units in FY17, 821 in FY16 and 475 in FY15. Isuzu sold 122 units in FY18, 263 in FY17, 168 in FY16 and 82 units in FY15.

Published in Dawn, November 18th, 2018