KARACHI - The auto sales (cars, LCVs & pick-ups) improved by 22 per cent to 20.9 units on year-on-year basis during the second month of FY10. The surge in local auto sales was mainly due to excellent growth registered by INDU and HCAR. The luxury segment continued to be the driving factor while a relatively flatter trend was observed in economy segment. Luxury segment remained in the limelight as 1300cc+ engine capacity cars continued to dominate car sales; increasing by 199 per cent. Indus Motors Corolla was the main contributor in this segment as its sales enhanced by 885 percent to 6.3k units. However, this massive upsurge is only reflective of lower sales last year as INDU discontinued production of the old model to launch the new Corolla model. On the other hand, Suzuki Liana sales came second in this segment; increasing 18 percent to 188 units. Hondas Civic and City also showed a rise of 9 percent and 2 percent to 877 units and 1.3k units respectively. Under the 1000cc segment (19pc share in overall sales), Dewans Santro shored up by 64pc to 69 units (due to lower base impact). Conversely, Suzuki Alto sales remained relatively flat, improving by 7pc to 1.4k units while Suzuki Cultus sales followed negative path; going down by 3pc to 1.9k units. A similar situation was observed for Suzuki in the 800cc segment, as Mehran registered a minor increase of 5pc to reach 3.4k units. However, a significant decline of 61pc was witnessed in sales of Coure. On a month-on-month basis, the auto sales increased by 10 per cent to 9.4k units in August. Moreover, combined sales of cars, LCVs and pick-ups followed a similar trend, increasing by 11 percent to 11k units. Dewans Santro took the pick as it increased to 52 units. Nevertheless, its weight in total auto sales was very thin (0.6pc); therefore it failed to trigger overall growth. Suzuki Mehran was the major contributor (21pc share) whose sales observed an increase of 44pc to 1.98k units. On the other hand, luxury segment sales declined by 0.6% to 4.3k units. Honda variants, City and Civic, were the major dampener behind this decline, whose sales were down by 8.2pc to 630 units and 6.8pc to 423 units respectively. Economic indicators are still showing signs of instability and the road to recovery remains farsighted. Under the present situation, higher car financing rates and stumpy liquidity position in the system are still the major factors behind the low recovery in the auto sales. Also, a broader factor for the present slowdown is higher inflation, which impaired the disposable income altering the consumption pattern.