No car price reduction from pak suzuki
  Nov 06, 2023     talha seo  


Due to a big drop in car sales of 44% in the first quarter of this year, car manufacturers in Pakistan have had to make some tough decisions. They are reducing prices and offering discounts to attract buyers. They say it's because the Pakistani rupee is stronger, but their financial reports don't back that up. Whether the rupee is strong or not, local car makers need to make more cars.


Deals and discounts have become the standard.

Reducing prices and giving discounts have become the norm for most car companies. Pak Suzuki, a big player in the Pakistani car market, hasn't joined in the price cuts. They've been struggling since the start of FY18, losing money in 12 out of 21 quarters.


Financial Difficulties and Analysis:

Looking at their financial data, it's clear that their prices don't cover their production costs. They only recently raised prices to try and fix this, but they're still struggling to make enough money. Import restrictions, trouble getting Letters of Credit (LCs), and sometimes closing their factory because they don't have enough cars to sell, these factors have all hurt their sales.


Efforts to Increase Sales:

Pak Suzuki is trying everything to boost sales, just like other car companies. But their sales numbers for the first quarter of this fiscal year are grim. They only sold 10,946 cars, compared to 16,639 during the same time last year, a 34% drop. The Alto, despite a 27% drop in sales, is still their best-seller. But the rest of their cars are selling even less, with some down by 55%.


Global Strategy and Market Potential for Suzuki

Pak Suzuki made headlines when it left the Pakistan Stock Exchange (PSX) last month. The parent company, Suzuki Motor Company Japan, plans to take over the subsidiary. They said this move doesn't mean they're leaving Pakistan. They still see potential in the Pakistani market.


Predictions and Future Challenges

The future doesn't look bright for Pak Suzuki or the local car industry. Experts think sales of cars made in Pakistan will drop by another 9%. That means slow sales for all of fiscal year 2023-24.


 Auto Industry's Changing Dynamics

Traditionally, the relationship between the Pakistani rupee and car prices was simple. When the rupee got weaker, car prices in Pakistan went up. Car makers waited for another rupee drop before raising prices. But things are changing now. Car makers need to sell more cars to survive.

 The big question is whether they can increase there sales with all the challenges they're facing?

talha seo