Pakistan Automobile News

Stability in the auto sector​

Aamir Shafaat Khan
May 25, 2026

Consumers have remained upbeat about new vehicles despite the ongoing war between Israel, Iran, and the USA since February 28, 2026, as outstanding auto loans surged for the 17th consecutive month to Rs359.5 billion by the end of April 2026, up from Rs345.34bn in March.

However, this recovery still does not match the peak financing we saw during June 2022 of Rs368bn, when the annual sales volumes were around 240,000 units.

Low interest rates continue to play a pivotal role in luring buyers towards low financing, followed by various packages by assemblers and private banks on affordable car financing. The rest of the demand is propelled by rising petrol prices, forcing people towards various categories of electrified vehicles in larger numbers.

Sales of cars, vans, pickups and sports utility vehicles clocked in at 22,015 units in April 2026, up by 107pc year-on-year (YoY) and 42pc month-on-month, taking 10MFY26 cumulative sales to 166,044 units, up 49pc YoY.

‘Pakistan still has the lowest financing limit and time period in all of Asia, keeping in view the market size and foreign exchange availability’
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If a global automotive manufacturer introduces a particular car model but the local subsidiary / Importer refuses to introduce the new model in the Pakistan market, within 2 years of its global release, then, a carbon tax of 25% should be levied on that particular model of car, forcing the local subsidiary / importer to introduce the lastest model in pakistan.

The older models give out more carbon emissions and hence, the 25% carbon tax.

Either you introduce the latest model in the market or you loose the market.

Toyota Corolla [ Decade old model ], Honda City [Older generation] and Suzuki Alto [ Older generation] are the targets of such 25 % Carbon tax.

Introduction into the local market means local assembly, not direct import.
 
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Some glimpses of under construction state of the art BYD plant in Gharo Sindh Pakistan .

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Pakistan's car sales surge 39% in FY26​

  • Motorbikes, rickshaws sales up by 30% to 1,972,077 units
July 13, 2026
Gohar Ali Khan
B Recorder

Car sales in Pakistan rose 39% during FY2025-26, driven by stronger consumer purchasing power, improved auto financing by banks, and a wider range of variants introduced by car assemblers.

Car sales surged by 39% to 155,631 units, sales of jeeps and pickups increased by 41% to 50,814 units, sales of trucks and buses rose by 67% to 7,439 units and sales of rickshaws rose by 25% to 985 units, respectively, according to the Pakistan Automotive Manufacturers Association (PAMA) data released on Monday.

Motorbikes and rickshaws went up by 30% to 1,972,077 units.

Meanwhile, sales of farm tractors slid by 1% to 28,791 units as growers are not willing to invest in the agriculture sector because of poor returns for a couple of years.

Speaking to Business Recorder, auto and bike analyst and expert Muhammad Sabir Shaikh said multiple reasons led to an increase in car sales in FY26, including increasing purchasing power of car lovers-cum-users, useful car financing schemes of banks suiting car buyers and more car assemblers coming with a vast variety of car variants and car types including fuel-driven, electric and hybrid.
 

Record $2bn CKD imports expose low localisation​

Aamir Shafaat Khan
July 19, 2026

KARACHI: Pakistan recorded an all-time high import of semi- and completely knocked-down (SKD/CKD) kits by local auto assemblers of over $2 billion in FY26, signalling either low localisation in new and old models amid robust auto sales.

As the local industry awaits the new auto policy after the current policy expires on June 30, followed by changes in taxes and duties in the budget 2026-27 and other policy initiatives, auto sales may remain upbeat in the coming months, in view of a 92pc increase in the import of CKD/SKD kits to $2.118bn in FY26, from $1.101bn in FY25.

Sales of cars in FY26 stood at 155,631 units, while SUV, pickup, van, and jeep sales totalled 50,814 units.

The previous all-time high import of parts and accessories by the assemblers was $1.7bn, recorded in FY22, when car sales stood at 234,180 units, followed by SUV, jeep, and van sales at 45,087 units. Total import bill of SKD/CKD has crossed over $6bn dollars from FY22 to FY26.
 
Part makers demand tariff review; auto loans surge amid robust sales
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Old assemblers claim localisation levels between 50-70pc, but many vendors argue that local parts in new models they are introducing are less than 50pc. Some new players, especially Korean assemblers, claim localisation of 35-40pc, while Chinese players are not ready to share their localisation.

State Bank of Pakistan’s foreign exchange reserves remain under pressure below $18 billion as of July 10.

In the current situation, it is critical that we utilise foreign reserves wisely. An open import policy is not in the national interest and will further strain the economy, said Mashood Ali Khan, auto parts maker and exporter.

To protect local industry and conserve foreign exchange, the National Tariff Policy must be reviewed immediately, he said, adding that a balanced tariff structure is essential to support domestic manufacturing, reduce unnecessary imports, and ensure long-term economic stability.

Pakistan’s local auto parts manufacturers are facing severe challenges due to the increasing import of SKD/CKD kits.
 
ghazi52 said:

Record $2bn CKD imports expose low localisation​

Aamir Shafaat Khan
July 19, 2026

KARACHI: Pakistan recorded an all-time high import of semi- and completely knocked-down (SKD/CKD) kits by local auto assemblers of over $2 billion in FY26, signalling either low localisation in new and old models amid robust auto sales.

As the local industry awaits the new auto policy after the current policy expires on June 30, followed by changes in taxes and duties in the budget 2026-27 and other policy initiatives, auto sales may remain upbeat in the coming months, in view of a 92pc increase in the import of CKD/SKD kits to $2.118bn in FY26, from $1.101bn in FY25.

Sales of cars in FY26 stood at 155,631 units, while SUV, pickup, van, and jeep sales totalled 50,814 units.

The previous all-time high import of parts and accessories by the assemblers was $1.7bn, recorded in FY22, when car sales stood at 234,180 units, followed by SUV, jeep, and van sales at 45,087 units. Total import bill of SKD/CKD has crossed over $6bn dollars from FY22 to FY26.
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In FY22 $1.7bn for 280k cars/suv vs $2.1bn for 205K in FY26. Thats 40-50% more per kit but amount of dollars Pakistan have without going in to debt is same as it was in FY26 because of zero growth in exports of goods.

Localization is non existent and have only worsened over the years. Changan Alsvin cost $8000 in China while $15000 in Pakistan despite local assembly. Now compare per capita income. Pakistan can easily cross 500k/annual sales with more localization and lower taxes if import bill stayed same in $.
 

Pakistan car sales jump 141% in July 2026​

  • Sales of jeeps, pickups fall 33%
August 11, 2026
By Gohar Ali Khan

Car sales in Pakistan surged 141% in the first month of the current fiscal year FY27 compared with the same month last year, with experts attributing the increase to eased bank leasing policies and lower interest rates.

Car sales stood at 17,216 units in July 2026, against 7,135 units recorded in July 2025.

Meanwhile, sales of jeeps and pickups fell 33% to 2,602 units, while truck and bus sales rose 169% to 854 units and 14% to 65 units, respectively.


Sales of two- and three-wheelers, including motorbikes and rickshaws, increased 40.7% to 177,089 units, according to data released by the Pakistan Automotive Manufacturers Association (PAMA) on Tuesday.

Moreover, farm tractor sales rose 4% to 1,242 units in the first month of the current fiscal year, marking an increase after several months of decline.

The modest recovery was attributed to improved economic conditions for growers, who appeared more willing to invest in farm machinery, following a largely downward trend in tractor sales throughout the previous fiscal year.

Auto sector analyst Mashood Khan said car sales had risen despite the segment’s relatively small size, describing the increase as a positive start to the current fiscal year.

He attributed the growth partly to improved bank leasing policies and lower interest rates, which have made auto financing more attractive to consumers.
 
On July 27, the State Bank of Pakistan (SBP) Monetary Policy Committee (MPC), in its first meeting in the fiscal year 2026-27, decided to keep the policy rate unchanged at 11.5%.

Another expert Muhammad Sabir Shaikh said the Punjab government’s tractor scheme was providing some relief to farmers, contributing to the increase in tractor sales.

He added that the decline in jeep sales was partly due to the growing number of SUV models available in the market, which had affected demand for traditional jeeps.

Mashood Khan called for localisation of vehicles and auto parts to a greater extent, saying it could help bolster the national economy.

Last week, Power Minister Sardar Awais Leghari-led committee deliberated on the “problematic” Auto Sector Development Policy 2026–31 and the current issues facing the domestic industry.

The committee discussed various challenges confronting the local industry, including the impact of Completely Built Unit (CBU) imports on existing players and delays in notification regarding the reduction in sales tax.

According to sources, the industry has sought government intervention to protect Pakistan’s automotive manufacturing sector from the serious risk of deindustrialisation resulting from the proposed reduction in CBU import tariffs under the National Tariff Policy 2026–31 (NTP 2026–31).
 

Pakistan to set up 150-acre automotive processing zone at Port Qasim​

Import-Refurbishment-Export Park to house 264 units across five segments, targeting $500 million in exports and an estimated $200 million annual net foreign exchange surplus

Pakistan’s Federal Minister for Maritime Affairs Junaid Anwar Chaudhry on Wednesday announced plans to establish an automotive processing zone on 150 acres at Port Qasim, envisioned as the country’s first dedicated Import-Refurbishment-Export (AIRE) framework for the automotive sector, with the facility to be expanded in phases according to market demand.

The decision was taken at a meeting attended by Port Qasim Authority (PQA) Chairman Rear Admiral (Retd) Syed Moazzam Ilyas and members of the PQA Board.

The minister said the auto zone would be expanded in phases after completion of the first phase, allowing the project to grow with market demand.


The proposed zone will comprise 264 operational units across five specialised segments. These include 30 commercial units, 84 refurbishment workshops, 60 car display units, 20 machinery yards and 70 auto spare-parts units.

The facility will be developed within the Port Qasim industrial corridor, providing direct access to the port and reducing inland logistics requirements for imported and exported vehicles.

The project aims to create an integrated platform for vehicle import, refurbishment, display and export.

Port Qasim's strategic location has been identified as a key advantage, given the port's role as one of Pakistan's major gateways for vehicle trade and a significant share of the country's seaborne commerce.

Project proponents estimate the AIRE Park could generate an annual net foreign exchange surplus of around $200 million, based on estimated exports of $500 million.

The facility is also expected to bring commercial activities, refurbishment facilities, machinery yards, vehicle displays and spare-parts suppliers into a single port-based ecosystem.

The proposed zone would sit along the Arabian Sea shipping corridor connecting South Asia with the Gulf and East Africa, potentially facilitating regional vehicle trade.

Rear Admiral (Retd) Syed Moazzam Ilyas said the phased approach would allow the project to expand according to market demand, adding it could serve as a model for establishing similar automotive zones elsewhere in the country.
 
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