Pakistan Auto_OEMs go back to launching new models for marketshare, (AKD Daily, Sep 11, 2020)
AKD Daily
Pakistan Auto: OEMs go back to launching new models for marketshare
- August’20 total automotive industry sales of 10,218 units (-14%MoM/-3%YoY) continuing the softening of monthly sales on YoY for 22 consecutive months, taking 8MCY20 total industry offtake to 67,727 units (-53%YoY), where major constituents moved -54%/-48%/-46% for Passenger Cars/LCV & Pick-ups/Trucks for the cumulative period
- Sector wide declines can be seen stabilizing, where Aug’20 sales for LCV and pickups climbed 61%YoY depicting a consolidating demand picture, hindered by rising tag prices, inflationary pressures burdening demand while soft consumer confidence indicates a holding back of discretionary consumer durable spend.
- For the passenger car segment during Aug’20 the commencement of sales for the Yaris seems to have brought back new life to the space, despite sales for the model slipping 9%MoM, the 1,300CC+ segment grew 2%YoY for the month, while 1,000CC/800CC & below, moved +10%/-28%YoY.
- Amongst major OEMs, INDU and HCAR witnessed sales uptick, marking rise of 52/72%YoY, while PSMC was worse off (decline of 9%YoY) on the back of late recovery in LCV sales. Over 8MCY20, PSMC/INDU/HCAR sales offtake receded -60/-42/-43%YoY, where model launches in the pipeline are likely to propel growth.
- Post launch of INDU’s Yaris, where offtake has been decidedly lukewarm, we believe an active product launch pipeline is going to drive demand and in particular, amongst incumbent OEMs, HCAR’s upcoming launch of an upgraded City (7th Gen by 1QCY21) is likely to garner significant new model effect buying behavior
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