AUTO SECTOR NEEDS EXPANSION

Size of the crop must be over 12 million bales to justify the word of bumper crop

By AZAM ALI
Sep 13 - 19, 2004

The tricky car pricing mechanism of automobile sector continues to deprive citizens of the real benefits of the good policy decisions and historic economic reforms initiated by the government. Though the automobile sector registered an unprecedented growth of at least 98 percent in the previous year and the volume of production increased tremendously yet the benefit was not passed on to the customers.

Instead a coterie of vested interest including automobile manufacturers and assemblers are sitting on the piled up by demanding trillions of rupees in advance booking for different models of the cars. The genuine buyers continuously facing hardship in getting delivery even after paying 100 percent in advance as desired by the manufacturing companies.

The outstanding results in economic sectors of the country are reflected in the fact that purchasing power has increased to an extent that during last two fiscal years (2002-2003) and (2003-2004) there was an unprecedented increase in production of cars as well as two wheelers which touched to the level of 658,968 units and noticeable growth in sales that is 650,727 units. Trucks, Buses, Tractors and other products are in addition to the above figures.

The number of vehicles sold during last two years are more than double that were manufactured and sold during previous four years (1998 to 2002 to 2003). The month of the June 2004 has broke the record in sale for which figures are still being compiled.

There are some lacunae in the mechanism for automobile sale, which are not in favor of the customers. The intended customer who desires to buy a car either on cash payment or through car financing scheme of the banking or leasing company has to wait for four to six months even after paying 100 percent in advance.

Taking advantage of the boom, the manufacturers and assemblers are demanding 100 percent advance payment and even after receiving the money, the companies were sitting on the huge piled up money for delivering in four to six months, on the other hand the middleman was also paying extra money to the tune of Rs. 50,000 to Rs. 60,000 per car.

"The money minting game will continue, even if you reduce the advance payment to any level," said a car dealer. He said that who has the car booking right? This has not been declared so far, however, cars are being booked by those who already have cars and they are not in emergency. One who is buying a car for the first time has to wait till the timeframe given by the manufacturers. The tremendous growth in the industry and increase in production volume was being tackled without capacity building.

PRODUCTION & SALE

The total volume of production during 1998-99 was estimated 47,383 units during (1998-1999) and 46,697 units were sold. According to break up, during the year 1999-2000 over 39,497 cars were produced. 47,117 units were produced and 46,904 were sold in 2000-01. At least 51,374 unit were sold in 2001-02. During (2002-2003) 75,491 units were produced and 75,152 were sold.

HONDA CIVIC: The company produced 3,928 and 3,794 units sold during (1998-1999). 4,871 units were sold in (1999-2000) 584 were produced and 5,873 were sold during (2000-2001). 4,615 produced and 4,625 sold during (2001-2002) 4,610 produced and 4,537 were sold during (2002-2003) and 5,998 were produced and 6,097 were sold during (2003-2004).

HONDA BALENO: As many as 2,412 were produced and 2,045 were sold during (1998-1999). 20,905 were produced and 2,883 were sold during (1999-2000). 1,251 were produced and 1,484 sold during (2000-2001). 1,240 produced and 1,188 sold during (2001-2002) 2,608 were produced and 2,588 were sold during (2002-2003) and 4,173 were produced and 4,062 were sold during 2003-2004.

TOYOTA COROLLA: As many as 8,369 were produced and sold 8,267 during (1998-1999). 8,705 were produced 8,779 were sold during 1999-2000). 8,486 were produced and 8,117 and sold during (2000-2001). 5,763 were produced and 6,151 sold during (2001-2002). 12,861 were produced and 12,867 were sold during 2002-2003). 20,525 were produced and 20,321 were sold during (2003-2004).

SUNNY: 481 units were produced and 546 sold during (1998 to 1999, 83 cars were produced and 95 were sold during (1999-2000). 319 were produced and 310 were sold during (2000-2001). 81 were produced and 113 were sold during (2001-2002). 51 produced and 67 were sold during 2002-2003). 26 were produced and 25 were sold during (2003-2004).

CLASSIC: Production of Classic started during (1999-2000) during which 890 were produced and 825 were sold. 1,784 were produced and 1,375 were sold during (2000-2001). 2,091 were produced and 2,287 were sold during (2001-2002). 459 were produced and 687 were sold during (2002-2003) and 188 were produced and 81 were sold during (2003-2004).

CULTUS: The production of Cultus started during (1998-1999) during which 6,991 were produced and 6,768 were sold. 4,635 were produced and 4,824 were sold during (1999-2000) 6,290 were produced and 6,027 sold during (2000-2001). 5,441 were produced and 5,637 were during (2001-2002). 8,097 were produced and 7,927 were sold during 2002-2003. 10,810 were produced and 10,795 were sold during 2003-2004.

ALTO: Alto cars production started from 2000-2001 during which 4,489 were produced and 4,187 were sold. 2,816 were produced and 3,072 were sold during 2001-2002.