Vehicle registrations decline sharply on sluggish demand
View(s):Sri Lanka’s vehicle registrations declined sharply last month due to sluggish demand of buyers ahead of the anticipated 2019 budgetary concessions for car imports but it was not so, motor traders said.
The Finance Ministry has taken a firm decision to clamp down on vehicle imports in the 2019 Budget introducing a massive luxury tax while increasing duties slightly reducing Loan to Value ratio on vehicle leasing.
It also removed the cash margin for the opening of Letters of Credit (LC) when importing vehicles to ease pressure exerted on motor traders.
29,837 vehicles of all categories have been imported in February, significantly down from 36,895 units in January and 38,427 units 12 months ago, JB Securities, a stock brokerage and an equities research firm report revealed.
2,347 cars were registered at the Motor Traffic Department in February, significantly down from 3,147 units in January and 5,024 units 12 months ago, it added pointing out that small engine cars accounted for 90.2 per cent of the registrations.
Brand new motor car registrations were marginally up to 434 units in February, from 429 units the previous month, but significantly down from 773 units 12 months ago.
The number of second hand motor car registrations fell to 1,913 units in February, from 2,718 units the previous month but significantly down from 4,251 units 12 months ago, JB Securities said.
Small engine cars (less than 1,000cc) accounted for 90.2 per cent of volumes. Toyota was the segment leader accounting for 890 units (Vitz 740) followed by Suzuki with 799 units (Wagon R 533).
SUV registrations were down to 534 units from 735 units in January, but up from 464 units a year ago.
Premium motor cars recorded 111 units in Feb marginally down from 113 units the previous month and 188 units 12 months ago.
The new car segment accounted for 55 units – Mercedes Benz accounting for 39 units of which 37 units were C class cars that probably are vehicles bought on permits, JB Securities said.
The lead time from order to delivery was almost four months and that was the reason why they are appearing in February registrations although the permits were suspended in October for new Letters of Credit.
Three-wheeler registrations recorded 1, 341 units, down from 1,706 units in January and not much changed from a year ago.
Motorcycles recorded 23,165 units during the month, down from 28,114 units in January and 27,812 units 12 months ago, the report said.