Price hike likely of brand new vehicles – CAIA president
By Hiran H. Senewiratne The prices of brand new imported vehicles would likely rise soon, given the global situation, president, Ceylon Automobile Importers Association (CAIA) Prasad Manage said. ‘If brand new vehicle prices move up it would badly impact especially young executives who are planning to purchase a new vehicle, Manage told The Island Financial […]
The president of the Ceylon Automobile Importers Association (CAIA), Prasad Manage, has warned that the prices of brand new imported vehicles could soon increase due to the current global circumstances. Manage made these remarks during a media conference at the Shangri-la Hotel, where the CAIA launched its 'Motor Rally 2026' event scheduled for August 16.
Manage also mentioned the Central Bank's directive limiting leasing facilities to 40 percent of a vehicle's value, which has made it harder for customers to purchase new vehicles. He further pointed out that the government's additional ad valorem taxes, including VAT and luxury taxes, have compounded the issue, making the environment for purchasing vehicles highly burdensome.
In addition, Manage noted that the taxing of close substitutes differently can distort consumption decisions and is a concern for the Association over the government's irrational categorizations and capacity-based penalties.
Furthermore, importers have expressed concerns that tightening macro-prudential measures could make it even more difficult for prospective buyers to afford vehicles. A significant hurdle is the current Loan-to-Value ratio applied to vehicle financing. Under the existing 50 percent restriction, purchasing a vehicle worth Rs. 18 million would require an upfront cash payment of Rs.
9 million, a figure that is unattainable for most salaried professionals who typically rely on leasing facilities. This affordability crisis has drastically altered the aspirations of the country's emerging workforce, importers remarked.
At the rally launch, Singer Finance's Managing Director and CEO, Thushan Amarasuriya, highlighted how the current economic and regulatory environment has altered the milestones for young professionals. He explained that in the past, young executives joining a company could afford to buy their first car using the benefits provided by their employers.
However, the surge in vehicle prices has now made this a significant challenge. Amarasuriya further stated that young professionals are now often forced to purchase motorcycles as their first vehicle, rather than cars, as an affordable option to fulfill their vehicle dreams.
Written by urgent.news from The Island Sri Lanka's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
