Pakistan Real Estate Times - Pakistan Property News

The increase in sales is attributed to some good orders from farmers and growers, coupled with the sale of tractors under the Green Tractor Scheme launched by the Punjab Government. - AP/File photo.

KARACHI: Only tractor industry has shown an 11 per cent improvement in sales during the last nine months of 2008-2009 while other sectors, like trucks, buses, LCVs and two- wheelers gave a poor sales performance, Pakistan Automotive Manufacturers Association figures showed.

A total of 41,135 tractors (Fiat and Massey Ferguson) were sold in July-March 2008-2009 as compared to 37,096 units in the same period of last fiscal year.

Sale of Fiat tractors and Massey Ferguson stood at 21,247 units and 19,888 units as compared to 18,342 and 18,754 units in July-March 2007-2008.

Senior Executive Directors of Millat Tractors, Sohail Bashir Rana attributed the increase in sales to some good orders from farmers and growers, coupled with the sale of tractors under the Green Tractor Scheme launched by the Punjab Government in October 2008 in which farmers were also provided subsidy.

He said his company met the 45 per cent share out of 10,000 tractors under the GTS while the rest was shared by other players.

The tractor industry, he said, had to maximise its production while there were also smooth supplies in parts from vendors since the vendors had thin orders owing to slowdown in production in other sectors.

He added that tractor sales had been going on, on both cash and loan. Bashir Rana told Dawn from Lahore that good production of various crops, like wheat and cotton, also encouraged farmers and growers to purchase new tractors.

He said that combined tractor sale of assemblers may cross 58,000 units at the end of the current fiscal year and his company’s sale alone may hover between 28,000 and 30,000 units.

Last year, tractor makers had increased prices by 10-12 per cent due to devaluation of the rupee against the dollar, coupled the rising trend in prices of imported raw material.

When asked why assemblers were reluctant to cut prices when global raw material prices had fallen, he said it was true that raw material prices had fallen in dollar terms, but losing strength of the rupee had offset the impact.

He claimed that the price of tractors had not been enhanced in 2009.

In other sectors, truck sales (Hino, Nissan, Dong Feng, Master and Isuzu) fell by 40 per cent to 2,175 units from 3,660 units while bus sales plunged by 47 per cent to 451 units from 852 units.

Hinopak Motors Director of Sales and Marketing Mohammad Irfan Shaikh linked the fall in truck sales to high interest rate, reluctance of financial institutions in extending credit for vehicle purchase, and to a sharp rise in the cost of CKD kits, etc. Similarly high rate of inflation has greatly reduced purchasing power of the people, in general.

The unexpected destabilisation of economy, compounded by political adventurism and the effect of global financial meltdown, has combined to deliver a severe blow to our economy, he added.

Due to currency fluctuations, the company had increased prices by 35 per cent during 2008 but a major portion was still being absorbed by the company. He said 2009 may prove difficult due to rising cost of production.

He said the auto industry slump recovery seems to be a long process due to various macro-economic factors, including tight liquidity, and lower credit availability, slower GDP growth rates and current depressed consumer consumption.

In bikes and three-wheelers, high prices and curtailing buying power of consumers had affected the bike sales by 26.5 per cent as combined sales of Honda, Yamaha, Suzuki, Sohrab, Sohrab three-wheelers, Qingqi, Qingqi three-wheelers, Hero and Ravi fell to 348,291 units in July-March 2008-2009 as compared to 474,291 units in the same period of last fiscal year.

Other Chinese bike makers were also facing slowdown in sales.

Sale of Light Commercial Vehicles (LCVs) declined by 22 per cent to 11,943 units from 15,403 units.

http://www.dawn.com/wps/wcm/connect/dawn...months--za