Motorcar registrations gain steam in March somewhat defying higher duties

Sri Lanka’s motor car registrations have picked up pace in March after the numbers fell in the preceding month in a sign that the people were willing to defy the higher duties for a little more comfort than the suffering they undergo daily using the inconvenient public transport system in the country. 

But, a leading analyst of the monthly vehicle registrations put the cause behind the uptick in the March numbers to 35, 150 units from 29, 837 units in February to the higher number of working days. 

According to JB Securities, the research arm of Colombo-based stock broking firm, which tracks the numbers on a monthly basis said, Sri Lankans registered 2,961 cars in March, up from 2,347 units in February. 

Sri Lanka’s government jacked up duties and slapped a hefty luxury tax on vehicle imports above a certain price point effective first week of March to curb the excessive vehicle importation, which caused a severe drain on the exchange rate and foreign reserves.

Although the monthly vehicle registration is a proxy for the imports, the two could diverge significantly in coming months, as local dealers stocked up leading to uncertainty surrounding the duties. 

Hence, the registration number could be higher while imports may have faltered.  

The most popular pre-owned car for Sri Lankans became Toyota Vitz with 1,157 units getting registered in March followed by the previous leading brand Suzuki Wagon R with 633 units.  
All in all, 2,539 units of pre-owned cars were registered in March, up from 1,913 units in February while 422 units of brand new cars were put on the road, slightly down from 434 units in the preceding month.

Despite the government’s brand new incentives towards more environmentally-friendly electric cars, such category of vehicles continued to sink with only 2 units being registered in March, down from 7 units in February. 

The policy u-turn on electric vehicles by the then Finance Minister Ravi Karunanayake effectively crushed a sprawling ecosystem for such vehicles, killing the commuters’ enthusiasm for going green while destroying the second hand market for such vehicles. 

People who bought entry level electric vehicles such as Nissan Leaf are still struggling to sell them even at a fraction of the price they originally paid. 

People are now highly skeptical over the future of electric vehicles in Sri Lanka, despite recent policy measures towards promoting such as irrational policy reversals, which have been a hallmark of the incumbent government.

Meanwhile, Sri Lanka saw the registration of 2,192 three-wheelers in March, up from 1,341 units in February and 26,851 units of two-wheelers, up from 23,165 units in February.