Pak Suzuki jacks up its car prices for a fourth time in 2023

Pak Suzuki Motor Company (PSMC) on Wednesday jacked up its car prices for a fourth time in the ongoing calendar year, with the hike going as high as Rs235,000.

The price increase will be applicable from April 6, 2023. On a cumulative basis, the company has raised vehicle rates by up to Rs1.203 million this year alone.

Suzuki’s cheapest passenger car – the Alto VX – will now be sold for Rs2.251 million following an increase of Rs107,000. The company’s high-end Swift GLX CVT saw a price increase of Rs235,000 and will now be sold for Rs4.96 million.

The firm made the first increase in car prices in 2023 on January 24, second on February 9 and the last one on February 20.

Much like the pverall economy, Pakistan’s auto industry is going through tumultuous times. It is one of the sectors most affected by rapid depreciation of the rupee and Letter of Credit (LC) issues, which arose due to depleting foreign exchange reserves because the sector is highly dependent on imported auto parts and raw material.

Meanwhile, demand for price-sensitive low-end cars in Pakistan dropped significantly in February amid supply chain issues and rising vehicle prices.

According to data released by the Pakistan Automotive Manufacturers Association (PAMA) last month, Pak Suzuki, which was once seen as catering to the entry-level segment, saw its sales drop 92% year-on-year to just 978 units in February this year.

The company managed to sell just 72 units of 1,000cc Cultus (down 96% year-on-year) and 544 units of 660cc Alto (down 92% year-on-year).

“Purchasing power of Pak Suzuki customers has fallen as compared to Toyota and Honda,” research analyst Wasil Zaman told Business Recorder earlier. “These numbers include the impact of supply chain issues as well.”

Meanwhile, almost all carmakers and motorcycle makers have jacked up prices multiple times.

In March, Honda Atlas Cars increased the prices of its vehicles that saw the price of its high-end Civic variant cross the Rs10-million mark for the first time in history.

Meanwhile, Indus Motor Company (IMC), the assembler and seller of Toyota-brand vehicles in Pakistan, also jacked up prices with the hike going as high as Rs2.017 million and the new rates came into effect from March 10.

Earlier this week, Pak Suzuki announced extending the shutdown of its motorcycle plant till April 15 and suspending its automobile plant operations from April 7 to April 14 due to inventory shortage as import restrictions continue to hit the auto sector.

Other listed companies including Toyota and Honda have also been forced to halt production during recent months due to economic difficulties that have seen central bank foreign exchange reserves drop to a level barely able to cover four weeks of imports, leading the government to impose import restrictions.