Demand for cars has skyrocketed in Pakistan over the years despite price hikes, supply chain hiccups, economic recessions, and other issues. The rise has been exponential, especially in the previous ten years.
According to a document from Pakistan Economic Survey (PES), approximately 1,977,704 cars got registered in the last decade, while 926,645 got registered in the last five years.
The data shows that by 2011, the total number of registered passenger vehicles in Pakistan was 1,881,560. In 2016, that figure swelled up to 2,932,619 and by 2021, it surged up to 3,859,264.
It bears mentioning that, between 2016 and 2019, car sales saw the biggest jump due, however, after 2019, the sales started slowing down due to the imposition of taxes and duties on locally assembled cars and sanctions on reconditioned Completely Built-Up (CBU) imports.
Future Concerns
Fiscal Year (FY2021-22) is still ongoing, which implies that this year’s sales are yet to be finalized. However, given the ongoing economic turmoil and a steep rise in petrol prices, car sales are likely to take a nosedive.
According to various analysts and industry experts, car sales are likely to drop by 25 percent in the next fiscal year. They cited local currency instability, raw material rate hikes, and rising shipping costs as major contributing factors behind the dip.
The severity of the situation is likely to get worse until Pakistan’s economy stabilizes, which could take a while, as hinted by the government.
