KATHMANDU, Aug 15: Despite four-month blockade, Fiscal Year 2015/16 turned to be a good year for Nepali automobile industry as registration of new vehicles grew by a whopping 43 percent compared to 2013/14.
Automobile dealer have attributed such a significant rise in registration of new vehicles to excess liquidity in banking system which lowered interest rates, rise in remittance flow and improve sale of vehicles in rural areas.
Statistics of Department of Transport Management (DoTM) shows, 343,765 new vehicles were registered in the country in 2015/16 compared to 239,583 vehicles a year earlier.
“We observed exceptional growth last year,” Shekhar Golchha, the former president of Nepal Automobile Dealers Association (NADA) - the umbrella organization of automobile dealers said. “Liquidity factor has played a major role.”
There has been increment in registration of vehicles in all segments except pickup and tractor/power trailer segment. Total vehicles registration has reached 2,339,169.
According to Golchha, excess liquidity in banking system caused interest rates to fall because of which people were attracted toward vehicles.
He also termed improved sale in rural areas as the other reasons that have increased sale of vehicles significantly. “Roads are being built throughout the country. Local people hare doing business by investing on vehicles. This has increased vehicles business in remote parts of the country as well,” he added Golchha.
Golchha further added that automobile industry is growing at an average of 35 percent annually in recent years.
Registration of two-wheelers increased by 36 percent to 267,439 units in 2015/16. Only 196,383 two-wheelers were registered in the country in 2014/15.
Shambhu Dahal, vice president of NADA, said rise in remittance flow is one f the reasons behind improve automobile sale. “Remittance flow into the country increased significantly in the aftermath of earthquake and the blockade. This increased flow of money also increased purchasing power of people,” Dahal told Republica.