Pak Suzuki (PSMC) is expected to announce a price hike of around Rs20,000-25,000 per unit on Friday (today), showing an upward revision of 2-4 per cent, market sources said.

Industry expert Syed Atif Zafar said that PSMC had last raised its prices in October 2012 by a similar quantum. He stated that the price hike, if implemented, will be the first price hike announced by a local manufacturer since cut in the age limit of imported cars.

Manufacturers linked the price hike to rupee devaluation against the dollar, increase in utility and transportation charges. They said due to non-availability of gas the industry had to run on LPG whose price was five times higher than natural gas. Diesel price hike had pushed up transportation cost while due to power load shedding of eight hours many industries had to procure costly diesel to run their units.

It is to be noted that motorbike assemblers gave new year’s shock by raising prices by Rs500-1,500 from January to offset high cost of production, as the new price of CD-70, Pridor, CG-125 and its Delux model is quoted at Rs68,000, Rs84,000, Rs98,000 and Rs118,000 as compared to Rs67,500, Rs83,000, Rs96,500 and Rs116,500 respectively.

A year ago, CD-70, CG-125 and Delux model were available at Rs66,500, Rs92,000 and Rs113,000 respectively. Rupee has lost its value by eight to nine per cent against the green back in the last one year.

They attributed the drop in sales to problem in CKD parts’ procurement from various sources which, he said, had now improved. They said due to cash problems, many people in rural and urban areas are purchasing bikes on installment basis.

Figures of Pakistan Automotive Manufacturers Association (PAMA) reveled drop in sale of Yamaha bikes to 33,091 units in July-December 2012 from 47,799 units in same months of 2011.

However, sale of market leader Honda during July-December 2012 improved to 317,349 units as compared to 290,751 units in same period last year. Sale of Suzuki bikes plunged to 8,201 units in the first half of current fiscal year from 10,597 units.

The Chinese bike makers had raised the wholesale price from Rs40,500 in March 2012 to Rs41,500 in November 2012 but they did not raise the prices from December onwards. Experts said some Chinese bike assemblers are enjoying good sales but overall assemblers are facing intense competition in the market and as a result their profit margin was falling.