Car sales in Pakistan slumped more than 30 percent in July, compared to the corresponding period last year, after the government increased sales tax that raised the prices of vehicles and devastating floods that hit the country.

According to data released by the Pakistan Automotive Manufacturers Association (PAMA), Pakistan Suzuki, a market leader in the small family cars category, saw its sales falling 48 percent during July 2010. Their newest product 'Swift' in 1300 hatchback category has particularly failed to lure potential buyers and only 195 units have been sold since its launch in January this year.

Indus Motors, which markets Toyota, was the only company to show a five percent surge in sales during the same period, due to increasing rural demands and the government, which goes for purchase of new vehicles every year.

Urban Pakistan tends to prefer Honda because of its sleek technology and up-market branding. However, the company suffered a 35 percent decline in sales during the given period.

Heavy vehicles like trucks, buses, tankers and tractors also dropped down by a minimum of 15 percent to a maximum of almost 50 percent in different categories.

PAMA data revealed that the sales of automobiles had gone down despite increase in production in almost all the companies.

The sales of motorbikes and three-wheelers did not show any significant change as compared to the previous year.

Abdul Razzaq, a local car dealer, said the depressing sales trend was likely to continue for a while because of increase in prices and devastating floods in the country.

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