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Mon, 21 August 2017 04:10:42
Sri Lanka vehicle registrations drop sharply in February
17 Mar, 2014 07:53:49
Mar 17, 2014 (LBO) - Sri Lanka's vehicle registrations have dropped to 23,130 units in February 2014, the lowest since April 2010, with a sharp drop in commercial vehicles, an analysis by an equities research house shows.
February with 28 days is a 'short month' which usually results in low registrations, followed by a pick-up in March. This year registrations dropped 17 percent from January, compared to a 15 percent drop in February 2013 from a month earlier.

The first Lamborghini car, a Gallardo LP 550, was also registered in the month, a note to clients by JB Stockbrokers said.

Motor car registrations which have been buoyed by to tax slashed permits given to state workers and hybrid cars which are taxed lower, dropped to 1,481 units from 1958 in January but were still higher than the 1,063 units seen last February.

In pre-owned or reconditioned cars segment, smaller Toyota Aqua and Honda Fit models, dominated, followed by Toyota Prius, JB Stockbrokers said.

Motor cycle registrations which dropped to 13,659 units in February from 16,452 units in January were also up from a low of 12,008 last February.

Commercial vehicles categories were down sharply from a year earlier.

Three wheeler registrations were down to 5,257 from 6,639.

Pick-up trucks were down to 117 units from 173 a year earlier, mini-trucks were down to 730 units from 1,165, light trucks were down 211 from 414, medium trucks were down 152 from 189.

Heavy trucks with a payload above 5 tonnes were down to 83 from 157. Bus registrations fell to 94 from 115.

Hand tractor registrations were down to 410 from 685 and large tractor registrations were down to 93 from 231.

Despite lower interest rates, there is no resultant pick up lease volumes for new vehicles, and the drops seen cannot be fully explained by the February effect, JB Stockbrokers said in a note.

Sri Lanka is recovering from a balance of payments crisis triggered by loans taken from state-run banks by utilities to subsidize energy which ultimately were accommodated by central bank credit.

Interest rates were raised and the rupee floated to correct the problem, but vehicle taxes were also raised, which some critics said say is Mercantilist knee-jerk response.

The International Monetary Fund also urged the state not to engage in such measures.

In addition to an overall slowdown in economic activity it is not clear whether a consolidation process kicked off by the regulator in the finance company sector is also making firms more cautious about giving new loans.

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