Auto Companies Aren’t Happy With The New Electric Vehicle Policy

Pakistan’s first electric vehicle (EV) policy hasn’t gone down well with the local automobile industry.

Almost all of the relevant auto-sector patrons have called the move an “ad hoc decision”. They agree with the decision to introduce electric cars in Pakistan, but not at the expense of the domestic industry.

A soured Japanese carmaker said,

We are unable to understand who has drafted and approved such a policy. The approval came as a shock to domestic automobile players whose consent was not sought by government officials on this key issue.

The policy that was approved yesterday by the federal cabinet will see 100,000 cars brought into the country over the next five years. Earlier, the government had shared its objectives of transforming 30% of cars to EVs by 2030 and imposing only a 1% general sales tax on their imports.

Furthermore, electric cars can be registered for free in a bid to make them reasonably priced for a large number of people.

“We were informed by government authorities that an electric vehicle policy was under consideration and stakeholders would be consulted before its finalization,” said Hyundai Nishat Motor’s Chief Financial Officer Norez Abdullah.

He added that they had just entered the market in Pakistan and had spent a lot of money to benefit from the Automotive Industry Development Policy 2016-21. He said,

Until yet, we have not collected even a single rupee out of our investments. The overall scenario of the local automobile industry is not encouraging and the government has introduced a new policy.

The auto companies are of the opinion that this can lead to a considerable increase in external debt and move jobs to other countries from Pakistan.

“There are many loopholes in this policy, we are unaware of the investment required to build electric vehicle-friendly infrastructure in order to save around $2 billion in oil imports,” Abdullah said.

The policy came under fire from auto parts manufacturers as well, with Muhammad Akram, Chairman Pakistan Association of Automotive Parts and Accessories Manufacturers, saying that the new policy will only create confusion as there already is an active auto development policy in place.

From the looks of it, auto manufacturers don’t seem too happy with the policy as electric cars will be a lot cheaper under this new policy. We will have to wait and see how the government responds to the auto companies.

  • The future is of EV or at least hybrid vehicles so all the companies operating in PK should bear this in mind. Don’t waste their money & buyers’ money on old technology. Regards

  • These companies have formed a cartel. The consumers have suffered severely at the hands of these car makers. The quality is absolute c grade. They even did not export a single unit to prove that they are offering competitive prices in Pakistan. The government should introduce more liberal policy and allow duty and sales-tax-free import of kits and allow free of cost registration with E-Vehicle Kits.

  • I would like to add further, These companies have not trained enough technicians to provide quality after-sales service. They have established only one or two service centers in big cities and the cost of technical service and parts is too high due to monopolization and cartelization. There are only few major parts in EV, noiseless, no oil change and easily maintainable. This policy should have been introduced five years back. Well done government. Keep it up and do not come under their pressure. They are seemingly involved in transfer pricing.

  • Auto mafaia will remain unhappy when Pakistan’ state looks towards auto sector advancement and public concerns.Govt has taken a good decision because import of fuel will definitely be decrease and we will be able to overcome export deficiency.

  • It should either be hybrid or EV. This will help reduce pollution a great deal as well as save Gov few bn $s that are used on import of petroleum. And for local ‘industry’ aka mafia, there concerns should be thrown into the dustbin. These vultures have been skinning the public for number of decades, its high time they are screwed.

  • Local automobile industry has been badly failed to achieve it’s goals even in decades neither in terms of price or quality. Unfortunately the new comers like kia has launched an outdated model in an exorbitant price. So I support the government decision.

  • Govt doesn’t have to listen their nonsense, almost all developed countries have favourable policy for low emission cars (such as tax incentives and subsidies). Pak should follow this,

  • I think would be more appropriate to call Govt EV’s PLAN rather then POLICY as such there is no contents in it to call policy except 1%Sales Tax at import level and Free Registration these two things cannot be claimed as EV policy
    It is good to introduce EV’s in Pakistan which will definitely be good for economy to save foreign exchange with positive impact on current account deficit, but on the other hand Govt didn’t share any road map to acheive this target by replacing a new vehicle with old one. It is to be noted that it cannot be converted like CNG, would recommend to get instantly involve new entrants plus existing one to have their technical input plus Govt support which they required

  • The auto industry in Pakistan should stop expecting a free lunch from the population, these free lunches have already weakened the economy.

    The first hybrid cars came onto the international scene in the mid-90s (Prius) and almost 25 years later in 2019, we do not have a single hybrid option in the market, leave alone plugin hybrids or EVs. At this rate, the auto industry is just destroying the efficiency of our economy.

    A normal petrol-driven car gives a fuel economy of around 10-15km per liter (the price of petrol is around 115rs nowadays), and an EV uses 1Kwh for every 8-10km (price of 1 Kwh varies from 10-20rs). Do the math, it costs 529% more expensive to ride in a petrol-driven car.

    Children have to go to school, people have to reach work, goods have to be transported, etc. The economy will benefit if these things are done efficiency rather than to provide protectionism policies to foreign businesses.

  • Well, if the auto companies are not happy with the policy then the policy must have been really good for the common man. That’s all there is to know.

  • There are certainly issues, but these need to be resolved for in my opinion, this is something we drastically need in Pakistan, for other than reducing imports of oil, greatly encouraging green cars can improve air quality.

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