Despite the drop in numbers from a year ago where the registrations reached an all-time low, vehicle registrations in August picked up to 41, 798 units from 35, 775 recorded a month ago, data compiled by a research unit of a stock broking house showed.
Interestingly, in comparison to 51, 161 vehicles registered in the same month last year, this is not much of a fall, which demonstrates the buyers are not discouraged by the higher vehicle import taxes and the higher interest rates in financing those vehicles.
But there is clearly a shift from Japanese vehicles towards relatively cheap Indian-made cars, 2-wheelers and 3-wheelers. According to JB Securities, August numbers have been mainly driven by those Indian small cars, 3-wheelers and 2-wheelers.
This demonstrates that the Indian auto makers have in fact not lost much as a result of the toughened vehicle market conditions in Sri Lanka.
The motor car registrations in August were 3,011 units, up from 2, 596 units in July. But in the corresponding month a year ago, the number was as high as
9, 107 units.
The August numbers were split between 1,738 units of brand new vehicles—majority being Indian made Marutis—and 1, 273 units of
pre-owned cars, comprising of Toyota, Suzuki and Honda.
The Indian made Maruti led the brand new pack with 632 units while Renault KWID, the new kid on the block, recorded 406 units, a steep jump from 72 units in July.
“This is a direct competitor to the Maruti Alto at a similar price range (Rs 2.1 million) and engine (800cc). Since Renault is linked up with Nissan globally, the agent is AMW thus one firm is controlling the two bestselling small cars,” said JB Securities Managing Director, Murtaza Jafferjee.
It has also been revealed that banks and the finance companies have found innovative ways to drive their leasing business by circumventing the 70 percent loan-to-value (LTV) ratio on vehicle financing.
According to information gathered by Mirror Business, the financiers have been evading the rule since it was imposed by way of granting a personal loan to the balance 30 percent of the value of the vehicle to the spouse or someone else, in effect financing the 100 percent value of the vehicle, thus raising serious questions about the effectiveness of the LTV rule.
Meanwhile, 3-wheel registrations have picked up from 3, 692 units in July to 4, 355 units in August with Indian made Bajaj controlling a market share of 89 percent, followed by TVS with 6.6 percent and Piaggio with 4.2 percent. August 2015 saw the registration of 10, 366 units of 3-wheelers.
In recent times, 3-wheelers became a main talking point for scarcity of labour in Sri Lanka, as a section of the country’s youth resorts to 3-wheel driving soon after leaving the school.
The 2-wheeler registration in August rose to 29, 365 units, surpassing 25, 015 in July and also 25, 836 units in August, 2015.
This demonstrates a section of the buyers who aspired to own a small Indian made Maruti having settled for an Indian made motorcycle as Bajaj claimed a leading market share of 28.6 percent.
This was closely followed by Honda with 27.5 percent, of which scooters accounted for 93 percent of their volumes.
There is a tie between Hero and TVS—both made in India—with 15 percent share each.
Meanwhile, electric car registrations recorded 44 units in August - all Nissan Leaf- little down from 59 units a month ago but well below the 380 units seen a year ago.
Sports Utility Vehicle registrations recorded 458 units in August down from 414 units the previous month and significantly down from 652 units 12 months ago.
Premium brand car registrations were 70 units in the month down from 87 units the previous month and from 102 units 12 months ago.
It is expected the government could slap even higher taxes on motor cars in the forthcoming budget if the vehicle imports continue to remain higher.