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Saturday, October 1, 2022

Kia and Toyota suspended new car bookings due to dollar hike

Toyota Pakistan and Kia Motors Pakistan have suspended booking for all of their car models due to uncertain and volatile market conditions in the country.

Due to the current political instability, Pakistani Rupee continued a non-stop downward streak for the 17th successive working day as US dollar climbed over 188.18 rupees in the interbank market.

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Furthermore, the rupee appears to have no relief in the near future due to the country’s political instability. In the last four days, the dollar has dropped from Rs 184 to around Rs 190, which is a significant drop for a currency.

On Sunday, the dollar began to fall after Prime Minister Imran Khan dismissed parliament following the opposition’s presentation of a no-confidence resolution.

Because all vehicle manufacturers import critical components, the exchange rate has a direct impact on them. As a result, the depreciation of the rupee put pressure on the companies.

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Experts estimate that the dollar has dropped 15.36 percent since the start of the current fiscal year in July 2021. The situation will remain volatile until a new government is in place.

Toyota Indus Motor Company Limited suspended the new car booking following the footsteps of Kia Motors Pakistan. Kia Lucky Motors suspended bookings for all Kia Picanto, Kia Sportage, and locally manufactured Kia Stonic models on April 4.

The company has put the bookings of all models of Kia Picanto hatchback along with Sportage SUV on hold. Moreover, the company has also suspended its latest models of Stonic EX and EX+ crossover.

However, the production, dispatches, and invoicing will continue as planned by the company.

The suspension by Kia motors may by due to the global semiconductor chip shortage. The dwindling rupee to the dollar exchange rate could also be one of the factors behind the suspension of bookings by Kia.

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