Public Accounts Committee (PAC), in its recent meeting, asked the government to reduce import duties on used cars in Pakistan.
The committee members rationalized that encouraging car imports will create tougher competition for local car assemblers. The move will offer more choices and force local assemblers to strengthen their value chain, they added.
PAC learned that the local car assemblers have collected around Rs. 217 billion from customers in advance bookings this year. Toyota Indus Motors Company (IMC) has collected Rs. 112 billion while Pak Suzuki and Honda Atlas have collected Rs. 41.66 billion and Rs. 23 billion respectively, Secretary of Industries and Production highlighted.
He explained that they collected 20 to 100 percent of the car’s price as “advance booking” from customers despite the fact their production facilities are not fully operational.
He further detailed that companies are compelled to deliver vehicles within 60 days of booking, adding that Toyota can produce 5,600 vehicles per year, but it does not do so because of its partially operational plant.
Opposing Argument
Honda Atlas Cars Limited (HACL) and Pak Suzuki Motor Company (PSMC) announced another production pause earlier this month. In a notice to the Pakistan Stock Exchange (PSX), the companies cited supply chain issues stemming from the government’s sanctions on imports and the deteriorating economy.
While PAC and the public want a reduction in import duties for used cars, the government is unlikely to do so due to the dwindling foreign exchange reserves.
A common consensus among experts suggests that, in such circumstances, the government and the auto industry should work in tandem rather than clash with each other.
In First stage 660cc used cars import on relaxed policy and minimize tax should be allowed …
مقامی اسمبلز عوام کو دھوکا کر ہے پیسے بنا رہا عوام کے پیسے سے اپنا کام کر کمپنی کو کوئی نوسکن نہیں لیزا حکمت کوچایا پرائیس کم کرنا پے زور دے اس مافا کے خلاف بہت نجز ہو رہا ہے
This is a very good step from PAC side and needs to be appreciated.
If the local auto-assemblers don’t improve their product qualities, more and more brand new and used autos should be imported. this will compel the local assemblers to improve and bring down the rates. if they dont improve they should be compel to wind up their business from Pakistan. No need for such crap auto industry which brings bad reputation to Pakistan
They are only saying this to get some heavy lifafas from the local car mafia. They will not allow it