The market observers, citing discussions with industry experts, expect soft sales in local automobile industry during the month of July. The lower numbers are primarily on account of completion of Punjab taxi scheme, prompt buying by dealers before price hike in June causing inventory pile up in the market and reduced price differential between local and imported CBUs. According to analysts at Topline Research, local industry sales may decline by 30 to 40% MoM during July compared to 19k in June 2012 with PSMC receiving the major hit. Companies wise break up reveals that Pak Suzuki sale is expected to decline by 45-50 % in July from 11k units sold in the previous month to 5700-6200 units likely in July 2012 This is in line with our expectations where we expect 2H2012 sales to decline by 31% as compared to 62k units in 1H2012. This is on account of no taxi scheme in the 2H2012 and short term effect of ban on CNG. On the other hand, the Indus motor sales are expected to decline 25-30 % to 3.9k to 4.1k units in July as compared to 5.5k in June 2012.
