Import of new cars surges three times in 1HFY21

The 196 per cent hike in imports of completely built-up (CBU) cars to $94 million during the first half of the current fiscal year (1HFY21) has raised doubts in the auto sector if the import of new vehicles by recent market entrants is on the rise or the arrival of used vehicles is increasing.

Talking to Dawn, auto sector stakeholders offered different views, with some expressing fears that the facility of importing 100 units under concessionary duty by new entrants is being misused. The Pakistan Automotive Manufacturers Association (PAMA) has also sought clarity from the Engineering Development Board (EDB) on incentives provided to the new entrants.

All Pakistan Motor Dealers Association (APMDA) chairman H.M.

Shahzad, while quoting the import statistics of Model Customs Collectorate of Appraisement, said a total 16,126 units of new and used vehicles arrived in JulyDec 2020. Used cars up to 1,000cc held the largest share with 6,840 units followed by 2,838 units from 1,301cc to 1,500cc. From 1,601cc to 1,800cc, imports of used cars stood at 698 units followed by 425 jeeps. Import of vans under personal baggage stood at 502 units and 36 units in 1HFY21.

He said that under the new vehicle category, 2,532 units of cars up to 1,000cc were imported, followed by 1,520 units under 1,301-1,500cc, 132 units in 1,601-1,800cc and 42 jeeps (4x4), taking total imports to 4,236 units. New vans and pickups imports stood at 310 and 22 units in July-December 2020-21.Mr Shahzad said the number of new vehicles' import from July-Dec 2020 has surpassed total fiscal year data of new vehicles during FY19 and FY20.

Under the Auto Policy 2016-21, new entrants are allowed to import 100 units under a concessionary duty regime to first test the market and observe consumers' reaction. He said the government should take notice of new entrants' activities as they are importing more vehicles rather than focusing on local assembly while huge foreign exchange was draining out. Due to a huge demand, they also hold huge booking orders in their hand, he claimed.

Existing assemblers are also playing havoc with the prices, he said, adding that the government did not take notice of over Rs1.1m price hike in Suzuki APV imported vehicle by Pak Suzuki Motor Company Limited.

While disagreeing over revival of used car imports from July to December 2020, he said old shipments of vehicles, which were stuck in Japan due to pandemic and containers issues, are now arriving.