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| Zared Raymond (Head of Account Management), Firaz Markar (Managing Director), Pradeep Jeevaratnam (Head of Product and Content) |
Sri Lanka’s pioneering online vehicle
retailer, Carmudi.lk, released a ground-breaking new research white paper
detailing the recent performance of the Sri Lankan automotive industry and an in-depth
analysis into key trends in vehicle financing.Analyzing a vast amount of historical
data, the newly released Carmudi.lk whitepaper, titled Car Financing in Sri
Lanka, offers up valuable insights, both into the overall performance of the
vehicle retail industry and a more holistic view that takes into account the
wider macro-economic factors such as steady GDP growth, access to low cost
credit, and a rising level of affluence within major demographics of Sri Lankan
society that have combined to generate an unprecedented level of growth within
the Sri Lankan automotive industry.
Speaking at the launch event Carmudi Sri
Lanka Managing Director, Firaz Markar elaborated on the rationale behind the
launch of Carmudi’s white paper and some of the key challenges and
opportunities facing the automotive retail sector.
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| VEHICLE SALES BY TYPE |
“There is today a considerable amount of
debate with regard to the current levels of demand for vehicles in Sri Lanka
and of course the proper approach to regulations in order to effectively cope
with such demand in a manner that is beneficial to all stakeholders.
“In that context, the release of this
report is a timely development that we hope will shed some light on the current
dynamics in Sri Lanka’s automotive industry and hopefully contribute towards
the formation of an effective discussion on regulatory policy and other salient
issues that is informed by hard facts,” he stated.
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| SHARE OF CARS PURCHASED WITH CREDIT |
Among the key findings of the Carmudi
whitepaper was the dramatic increase in registrations of new vehicles in 2015
which hit an all-time high of 4,990 vehicles in August 2015, as compared with
the previous year.
Small cars, hybrids and full-electric
vehicles were found to have displayed a rapid increase in popularity among Sri
Lankan consumers over the course of 2015, in part boosted by the volatility in
state regulatory and import policy which may be having a notable impact on demand
as consumers look to secure the best possible deal on their purchases.
In that process, the majority of savvy
Sri Lankan consumers appear to have capitalised on cheaper funding lines in
order to make their purchases as evidenced by a larger reliance on the car
financing options.
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| GDP PER CAPITA: 2012 VS. 2014 |
However Markar noted that potential
changes to vehicle taxation policies and a reversal on downward interest rate
momentum could tip the balance of vehicle financing in favour of an alternate
model where consumers may be forced to take on a larger proportion of the total
cost of the vehicle, potentially signalling a shift in conditions for finance
companies and banks.
“Recent events resulting in vehicle
values going up have definitely affected the market. We see lower sales in
vehicles since news broke of this increase. Interest rate changes are not
expected to affect the market drastically due to it being a very nominal
increase thus far.
“We will continue to monitor the market
over the next month or so as dealers adopt a wait and see approach towards
vehicle buyer intent. We expect the market to return to normalcy over the following
month or so with sales expected to be largely within vehicles falling within
lower price brackets,” Markar explained.
An easy-to-use web-based platform for
the buying and selling of vehicles. Carmudi allows users to quickly and easily
advertise a vehicle that they wish to sell while providing unprecedented access
to Sri Lankan buyers to browse through a host of options. In bringing buyers
and sellers closer together in a dynamic, online market place Carmudi.lk is
rapidly emerging as a truly innovative player in Sri Lanka’s vehicle retail
industry.
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