KARACHI: Import of used cars has fallen to 4,974 units in the first half of the current fiscal year as compared to 10,174 units in the corresponding period of last fiscal year. This depicts more than 51 per cent decline in import of used cars.
All Pakistan Motor Dealers Association (APMDA) Chairman H. M. Shahzad attributed the big drop to the cut in age limit of used cars to three years from five years in December 2012, followed by another cut in depreciation limit to two years from three years.
He said that the importers/dealers of used cars are getting depreciation of two years but the cars being imported are of three years age limit. Used car prices of three-year-old are higher as compared to five-year-old cars.
Shahzad said that consumers had a wide choice for purchasing used cars, particularly of lower engine power vehicles when imports were thriving. They now have limited options while the local car industry offers decades-old models of Suzuki Mehran and Suzuki Cultus at very high prices.
He suggested that importers should get three years depreciation which would improve imports and revenue. Figures provided by the APMDA reveal that import of cars from 1,001 to 1,300 cc stood at 14 units as compared to 1,079 units while from 1,301 cc to 1,500 cc only 783 units arrived as compared to 6,236 units. Arrival of 1,601 to 1,800 cc vehicles shrank to 661 units from 1,279 units. However, import of jeeps (4×4) went up to 388 units from 275 units. While, the remaining imported vehicles were below 1000 cc.
Shahzad recalled that when five years old cars were allowed, almost 80 per cent imports comprised of 660 cc to 1,000 cc vehicles of different models.
The government is in the process of finalising the new auto industry policy and has invited all the stakeholders to give their feedback including used cars dealers.
The APMDA chief urged the government to bring used cars/vehicles under the ambit of commercial import with a five to 10 years age limit by amending Sr.No.10 of Appendix-C of Import Policy Order 2013. “This would generate more revenue,” he said.
He also suggested the government to allow certified members of APMDA to import the used vehicles on commercial basis for the sake of transparency of the trade.
He said that all ad hoc schemes such as the ‘infamous amnesty scheme’ should be banned for ever. “Smugglers should be dealt with under the law instead of giving amnesty,” he said.