The auto industry witnessed a lot of ups and downs in 2073 BS, but this has not hampered their motivation to move forward in the new year

Kathmandu

After the massive earthquake of April 2015, followed by the border blockade which caused a significant decline in sales, the auto industry made a strong comeback. However, although the start to the year seemed very promising, the industry was scarred again by the liquidity crisis and tightening of auto loan flow by Nepal Rastra Bank (NRB).

“In terms of sales number and growth — compared to last year, we witnessed more than 60 per cent growth,” shared Karan Chaudhary, Managing Director at CG Motocorp, adding that however, the tightening of auto loan flow by NRB dented the growth. According to Chaudhary, Ashwin (September-October), the festive month saw the highest sales (950 plus units), Whereas, Falgun(February-March) and Chaitra (March-April) had the lowest sales (around 200 units) due to the current scenario on auto loan. “We would have been capping this year as one of the best in automobile business, if it hadn’t been for the financial crisis. We have managed to sell more than 7,000 units in 2073 BS, but the sales figure should’ve been much higher,” he revealed.

Citing the expectations for 2074 BS, Chaudhary shared, “If the current financial crisis is not resolved, we see a whole lot of challenges to provide the best solution to our customers.”

Furthermore he said that the competition is going to be even more aggressive with each expecting a new product line up and strategy. “With auto loan facility getting tighter, it is sure to bring out the best from all brands to increase their sales and maintain growth. This will open wider options to the customer, which in turn should lend some positive impact to the industry,” he claimed.

Chaudhary revealed that Maruti is bringing two new products into the market — Ignis and the new Swift.

Similarly, Sunil B Chettri, Deputy General Manager at GO Automobiles, authorised distributor of Ford, shared, “The year 2073 BS was a mixed bag for us and for every auto dealer. We started with good sales, and momentum to festive season was great. Then it has been sluggish due to the ongoing financial crunch and cap on vehicle financing ratio,” adding that they were able to sell more than 1,400 units in 2073 BS. “Limitation on auto loan is not a justified case at all. Four-wheelers have become a basic necessity rather than a luxury item. This move will surely bring down the sales.”

In addition to that, “the government will lose a big chunk of import revenue from the auto segment which ultimately will dampen the mobility of development activities,” Chettri claimed.

Talking about the plans for 2074 BS, Chettri revealed, “We look forward to open up two sales outlets (Butwal/Narayahghat) as per Ford standard, and a 3S facility in Kathmandu-Chabahil. We are also planning to launch the legendary ‘Mustang’ during September NADA auto show.”

Bibek Balami, In-charge, Sales and Marketing at United Traders Syndicate, authorised distributor of Toyota vehicles, expressed similar thoughts and experience. “The year 2073 BS was really a great year for us — we launched our new 3S facility in Dhumbarahi and we also celebrated our 50th Year Anniversary. But like every other automobile company, we are facing the effects of the liquidity crunch in Nepal,” he said.

According to Balami, as the majority of auto sales is dependent on auto loans, the sudden ban has had a shocking impact not only on the overall auto industry but also on a huge pool of customers. Citing that they were able to sell 1,000 units of Toyota vehicles, Balami informed, “With the support of some valued banking tie-up and great effort from our overall team, we have been able to move forward.”He disclosed that in 2074 BS, they are planning to launch the All New Fourtuner and Innova Crysta.