Senate’s standing committee on industries and production has again taken notice of the recent increases in car pricing and the long delivery period that led to huge premiums charged by dealers for locally assembled cars. The unregulated increase in vehicle prices has raised serious concerns from the Senate. Senators emphasized the problems brought on by the country’s escalating car prices.
Senate panel Blamed Automakers About Rising Car Prices:
In a meeting of the Senate Standing Committee at the Parliament House, they claimed that automakers are raising the cost of vehicles while citing currency depreciation as justification. They asserted that there is a monopoly among automakers in the country. The committee reviewed legislation intended to stabilize auto prices and organize the sector. Also emphasized for regularization are the costs of steel and iron.
The members also raised the issues of own money and protracted delivery delays. They said that the delays are a deliberate strategy to get more money from the customers. It typically takes eight to nine months for a reserved vehicle to delivered. The chairwoman asked the Ministry of Industries and Production to resolve the own-money and vehicle delivery delays.
Car Manufacturer’s Response Against Allegation:
While the government and its policies are being blamed for the current state of affairs by the auto industry. These are the government’s series of economic mistakes that led to the car manufacturers announcing production reductions. Additionally, the state bank of Pakistan’s restriction on LCs was blamed by the auto industry for causing delivery delays.
They added due to the non-approval of the letter of credit (LC) required for clearance of completely knocked-down (CKD) car assembly kit imports, automobile manufacturers have announced several cuts in production this year. The State Bank of Pakistan’s (SBP) refusal to approve LCs put a stop to business and delayed deliveries. Additionally, car sales have been impeded by SBP’s prohibitions on auto loans. Additionally, they claim that Rupee devaluation is the primary cause of the car price increases as prices of materials and logistics have also skyrocketed.
