The Ceylon Automobile Importers Association warns that new vehicle prices are likely to increase due to global factors, while stricter lending rules and layered taxation are making purchases increasingly unaffordable for Sri Lankan professionals.
The president of the Ceylon Automobile Importers Association has cautioned that prices for imported vehicles may climb in the near term, citing broader global economic pressures. Prasad Manage raised the concern while announcing Motor Rally 2026, scheduled for mid-August, warning that any uptick would disproportionately affect young working professionals considering vehicle purchases.
Beyond international price movements, local policy has compounded affordability challenges. The importers' association criticized the government's multi-layered tax structure, which stacks value-added tax and luxury levies on top of excise duties, creating what the group describes as an excessive tax burden. The Central Bank's recent directive capping leasing facilities at 40 percent of a vehicle's value has further constrained purchasing power by reducing the financing options available to buyers.
The industry has also flagged macro-prudential lending restrictions as a critical obstacle. Under current loan-to-value ratios of 50 percent, purchasing an vehicle valued at Rs. 18 million requires an upfront payment of Rs. 9 million—a prohibitive amount for most salaried employees. This financing squeeze has fundamentally altered purchasing patterns among the country's emerging workforce. Singer Finance's managing director noted that what was once an achievable milestone for young executives entering the workforce has now become a significant hardship, with motorcycles increasingly serving as the first vehicle many can afford rather than cars.
