Vehicle registration projected to break record this year

KATHMANDU, JUN 12 - 2013

The first 10 months of the current fiscal year has seen a significant growth in registration of new vehicle s. The number of vehicle s registered over the period has surpassed the figure achieved in the entire last fiscal year 2011-12.

Import/sales trend indicates annual vehicle registration this year could break previous records. Annual vehicle registration had hit record high of 201,787 units in 2009-10.

In the review period, 174,485 units of new vehicle s entered the market—17,448 units per month on an average. In the whole last fiscal year, 170,084 automobiles were registered, according to the Department of Transport Management.

The department said easy bank financing facility at cheaper interest rates contributed to the increased vehicle imports.

In the two wheeler segment, a total of 147,783 units of motorbikes were registered in the review period. The figure was at 145,135 units in the last fiscal year. The department said, around 90 percent of the vehicle s being registered annually are two-wheelers.

Department officials said registration of vehicle s is in increasing trend in all segments, with the growth rate remaining high in bus, heavy equipment and pick-up van categories. “Registration this year is projected to set a new record,” said Moham Bhattarai, mechanical engineer at the department.

After the government increased excise duty, auto sales had dropped to 163,640 units in 2011-12. Sales, however, gradually rebounded from the last fiscal year.

Automobile dealers also attributed the growth in registration to easy financing facility and increased buying capacity of customers due to remittance inflow.

Nepal Auto Mobile Dealers’ Association (NADA) said the interest rate on auto loans, which used to be at around 18 percent, has now come down to 10-12 percent. “The market has comparatively improved and has come out of the crisis felt two years ago,” said Shekhar Golchha, vice president of NADA. He added presentation of a full-fledged budget for the next fiscal year could further boost the market.

Dealers are hoping the demand for automobiles will increase further in the final month of the fiscal year, with the transport department proposing a hike in taxes including, registration charge, vehicle tax, licence issuance fee and road maintenance tax, in the budget for the next fiscal year.

“We have proposed a certain percent hike in the taxes,” said Sarad Adhikari, director at the department. He said there has not been any change in tax structure for the last three years.

However, NADA is against the proposed hike in taxes. It had recently suggested the government cut down tax rates as vehicle s are expensive. It had also drawn the government’s attention to reduce the customs duty to zero for the country being a member of the World Trade Organisation.

Source: The Kathmandu Post