Auto assemblers raise prices after 7pc hike in GST
KARACHI: Auto assemblers have started passing on the impact of a seven per cent jump in general sales tax (GST) to 25pc.
As per a notification of Lucky Motor Corporation Limited (LMCL), the new price of Stonic EX and EX plus has been revised upward to Rs5.200 million and Rs5.730m from Rs4.900m and Rs5.400m.
Sportage Alpha, FWD and AWD prices have been enhanced to Rs7.050m, Rs7.790m and Rs8.370m as compared to Rs 6.650m, Rs7.350m and 7.900m.
The new price of Sorento 2.4L FWD is Rs 9.540m versus Rs 9.000mn while the price of Sorento 2.4L AWD and 3.5L FWD has been increased to Rs 10.390m each from Rs 9.800m.
The price of Peugeot 2008 Active and Allure price has been jacked up to Rs6.840m and Rs7.580m from Rs6.450m and Rs7.150m.
A dealer said the new GST at 25pc rate would be applicable on 1,400cc and above vehicles from March 8, 2023 and many assemblers are likely to pass on the new prices soon.
On Friday, Indus Motor Company (IMC) informed analysts about a drop in sales by 52pc year on year in IHFY23, while market share shrank to 18pc from 20.4pc in IHFY22.
As per a note of Top Line Securities, sales fell due to import restrictions on parts. The State Bank had allowed 50pc of the import quota till November 2022. After December 2022, the LC issue had been transferred to the discretion of banks, leading to a further drop in import quota in the range of 25-30pc for different auto assemblers.
With no plan of downsizing staff, the company has made other contingencies such as management reducing fuel expenses by 25pc and saving on electricity etc.
According to Insight Research, IMC said its plan regarding a $100m investment to build hybrid vehicles is on track despite deteriorating economic conditions. A new variant of the Toyota Revo/Hilux will be introduced in the coming days followed by similar development on Toyota Yaris.
Published in Dawn, March 11th, 2023