Surge in vehicle demand reported in Sri Lanka amid rising Japanese auction prices

The Vehicle Importers’ Association of Sri Lanka (VIASL) has reported a surge in demand in the local vehicle market, driven mainly by rising vehicle auction prices in Japan.

VIASL Secretary Usman Ali said that market prices for popular mid-range vehicles with engine capacities between 1,000 cc and 1,500 cc, such as the brand-new Honda Vezel and Toyota Raize, have increased due to strong local demand.

In contrast, while there is steady interest in low-engine-capacity vehicles such as the Daihatsu Mira and Suzuki Wagon R, potential buyers are finding it increasingly difficult to purchase these models due to the 50% Loan-to-Value (LTV) ratio currently in effect.

The Secretary also highlighted an expected 2.5% increase in total customs duty following the implementation of the Social Security Contribution Levy (SSCL) at the point of import, which is scheduled to come into effect from April 1, 2026.

VIASL noted that the current market trend reflects a combination of global price pressures and domestic financing constraints, both of which are affecting vehicle affordability in Sri Lanka.