- 28, 752 vehicle registrations recorded across all categories in July
- But expected to come down in Aug. due to potential stockouts
- Vehicle imports been suspended since March to defend currency
- Importers call for clarity from govt. as to when suspension ends
Vehicle registrations in the month of July remained strong, even though lower from June, driven by existing inventories but the momentum could slow in August due to potential stockouts in certain vehicle categories as the government has put a lid on vehicle imports.
July saw the registration of 28, 572 vehicles across all categories, down from 32,123 units in June, when the number reached the pre-pandemic levels for the first time since February as people rushed to buy vehicles before the exhaustion of the existing stocks, which triggered pent up demand.
“Vehicle registrations in July were only slightly down from June but remain at healthy levels indicative of existing inventory driving sales. It is likely that this momentum slows in August due to stockouts in certain categories,” said Murtaza Jafferjee, Managing Director of JB Securities, an equity brokerage and research house, which monthly compiles registration data.
The Central Bank on March 19 suspended vehicle imports for three months under letters of credit as part of its broader curbs on non-essential imports to alleviate pressure on the currency as foreign incomes weakened since March due to supply chain restrictions globally.
The suspension was extended in June, barring the items and commodities deemed as essential and intermediate goods used in value additions industries for export.
The suspension could be in place until the authorities feel the economy is in better shape to withstand higher imports.
Vehicle importers and local agents for international vehicle brands recently called for clear direction from the government on when the suspension on vehicle imports would come to an end as thousands of jobs in the industry are in danger.
The latest Central Bank data showed the plunge in vehicle imports in June by 81 percent to US$ 9.2 million from the comparable month last year. During the first six months Sri Lanka spent US$ 273 million for vehicle imports in comparison to US$ 324 million in the same period in 2019.
Sri Lanka last week created a State Ministerial portfolio for, ‘Vehicle Regulation, Bus Transport Service, and Train Compartments and Motorcar Industry,’ and appointed Dilum Amunugama as the Minister, giving an indication that the government is keen on streamlining the public and private transport sectors.
Meanwhile, according to data compiled based on vehicle class, there were 1,712 units of motorcar registrations in July, compared to 2,032 in June and 2,584 units a year ago. Out of the 1,712 units, 272 were brand new cars.
Three-wheeler registrations were recorded at 635 units in July, down from 1, 098 a month ago and 1, 118 a year ago.
Two-wheelers, which had the largest share in the total vehicle stock registered in July, saw the registration of 22,419 units, down from 25,162 in June and 24,739 units in the same month in 2019.