KARACHI: In a recent move, the automobile assemblers in Pakistan, have increased the prices of cars by an average of 9.4 per cent in March 2022.
The increase in the prices came as the assemblers tried to pass-on the cost pressures emanating from the continuous rupee depreciation against the dollar. This is the third time the prices have increased after the announcement of the federal budget 2021/22.
The highest price jump was witnessed in 1000cc cars, where the price of Cultus, Wagon-R and Picanto surged in the range of 30 per cent to 36 per cent, while the lowest price increase was spotted in Crossover SUVs such as Sportage and Tucson, where the prices increased in the range of 14 per cent to 17 per cent.
The 14.7 per cent hike in the price of City 1.2M/T touched the upper end of the spectrum, while the 3.7 per cent increase in the price by Sportage AWD settled at the other end of the spectrum.
The new Civic that was recently launched in March 2022, also witnessed a price hike in the range of 4.5 per cent to 6 per cent, while the Suzuki Swift that was launched in the same period saw price increase by around 7.8 per cent to 9.3 per cent.
However, the first round of price hike came in November 2021 on account of rising cost pressures, followed by January 2022 when the government reversed the tax benefits given in the budget for the fiscal year 2022, an analyst at Ismail Iqbal Securities said.
Looking at the currency depreciation, further price hikes cannot be ruled out. The continuous price hikes coupled with higher interest rates and limitations on auto financing would likely to hurt the auto demand in the next fiscal year, he added.
Comparing the current prices with the post-annual budget prices, where they were reduced due to a cut in the sales tax and federal excise duty (FED), shows the magnitude of price hikes in the ongoing year.