Cars in Pakistan are expected to get pricier, no thanks to the COVID-19 global pandemic. As the global economies are slowly reopening, there is an abnormal growth in imports. That has led to a shortage of containers and an increase in the transportation costs of containerized cargo. Since most car brands in Pakistan are almost entirely dependent on the import of car kits and parts, car manufacturers have to pay a lot more for the imports. As a result, companies will increase car prices for consumers.
Remember how Changan increased the price of Alsvin, even before hitting the road? The company stated similar reasons like container shortages and increased shipping costs for the not-so-pleasant surprise. As the problems seem to persist, other car companies in Pakistan might be making the same move.
Freight Rates Increased by 700%
Due to the abnormal growth in the demand for the containerized cargo, freight charges are out of bounds. In the words of Former Chairman of Pakistan International Freight Forwarders Association, Malik Moin, “International freight charges have surged by up to 500-700% over the past couple of months. Freight charges for cargo in a 20-feet container arriving from China to Pakistan has increased to $2,000-3,000 compared to around $700 in June 2020 and before.”
The Chairman also remarked that this is the first time freight charges are this crazy high over the past 25-30 years, and they are not coming down in the next four to six months.
“Pakistan government is not responsible for the situation in international trade. Nor can it (alone) do anything to control it,” continued the Chairman.
Indeed, the Pakistani auto industry is not alone in these challenging times. Countries all over the world are facing the same problems because of the COVID-19 pandemic. But the nation is not okay with the fact that every time there is a tough situation, it’s always the consumers who are asked to “tighten their belts” and “roll with the punches”. Dollar price increased? Ask the consumers to pay more for cars. Freight rates are high? Increase car prices, consumers will manage.
What are your thoughts on the expected car price hike in Pakistan? Let us know in the comments, and we’ll see you next time with another auto industry news.
