Jan 242010
 

By Moonis Ahmed

Taking full advantage of the government’s inability to check and control unjustified hike in car prices, another local car manufacture has increased the prices of its different models, dealers told Daily Times on Saturday.

Indus Motor Company (IMC) on Saturday revised the prices of Coure and Hilux Pickup by some Rs 20,000 to Rs 30,000, respectively.

Price of Coure after this increase stands at Rs 749,000 as compared to Rs 729,000 previously. Similarly, the prices of Hilux Pickup has gone up to Rs 1,459,000 as compared to Rs 1,429,000. IMC Director Corporate Planning Sherayar said that besides appreciation of yen and dollar the price increase of allied industries has been the major reason for this increase. Yen has increased by almost 22 percent against the rupee in 2009, thus resulting in rising cost of imported completely knocked down and completely built-up, raw materials, etc.

The Indus Motors executive said that rising international prices of metals were also resulting in high cost of auto parts and production. He said that the local auto industry had been under pressure since the last two years and high auto financing rates reduced auto sales.

However, All Pakistan Motor Dealers Association Chairman H M Shahzad expressed surprise over the stance of the auto industry that it was doing its best in absorbing the negative impact of rising production cost.

He urged the government to check whether these increase by the assemblers were really justified with the actual impact of falling rupee, rising metal and steel sheet prices and petrochemical items.

He was of the view that semi-knocked down and completely knocked down kit prices all over the world had fallen.

Shehzad said that there has not been any check and balance over the price hike of the local manufacturers by the government. Economic Coordination Committee has recently asked the Ministry of Production to control this price hike but no impact has been observed so far.

Shahzad urged the government to reduce the taxes on imported vehicles. “Importers are paying 360 percent overall duties as compared to 120 percent in 2007-08. Cost pressure is also likely to aggravate due to weak rupee against dollar and yen and higher steel prices, which might have an impact on sales of local cars,” an analyst said.

It is pertinent to mention that the global economic downturn savaged worldwide demand for high-value items like automobiles, particularly in the first half of 2009, prompting most automakers to curb output. But several governments, including Britain and Germany, introduced new-for-old schemes to encourage motorists to ditch less efficient and older vehicles for newer models.

http://www.dailytimes.com.pk/default.asp?page=2010\01\24\story_24-1-2010_pg5_12

[lastupdated]

Mohammad AbdulRahim

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