The auto vendors have asked the government to revisit import of used cars policies during the upcoming budget as the import of used cars has caused over Rs. 50 billion in losses to the country’s economy during the first eight months of the current fiscal year.
According to data, the used vehicles soared to 25,000 units, marking a staggering 641 percent increase during the first eight months of the current fiscal year, compared to last year’s 3,386 units imported.
The representatives of the local auto industry told ProPakistani that the local automobile sector is suffering due to the government’s decision to allow the import of used and unregistered vehicles.
They argued that the government consistently fails to safeguard local industries, despite these industries benefiting from billions of dollars in foreign investments and providing employment to over 5 million workers.
Industry representatives revealed that the import of used cars has caused over Rs. 50 billion in losses to the local industry and economy during the first eight months of the fiscal year 2023-24 alone.
Initially intended for overseas Pakistanis, the allowance for used car imports has been exploited through corrupt practices, with vehicles imported in their names for profit-making ventures, claims the industry.
The document highlights that favorable taxation and duty policies towards used car imports have also played a part in crippling the local assembling industry, leading to reduced demand for domestically assembled automobiles.
The automobile manufacturers are also concerned that grey channel transactions for used car imports pose a significant threat compared to legal transactions for local manufacturers, resulting in potential revenue losses for the economy.
Furthermore, despite an unwavering resolve to manufacture a substantial portion of car parts locally, unfavorable policies have led to inefficient production facilities, job losses, and a lack of motivation to boost the local industry.
According to industry suggestions, the government should immediately discourage or regulate used car imports to support local industry growth and competitiveness. Besides, policymakers should engage in creating mutually beneficial policies that foster industry growth and job creation.
Furthermore, relevant authorities need to implement consistent policies that enable the local industry to thrive and contribute positively to the economy.
Pakistani automobile manufacturers asked the government to protect millions of families from unemployment, it said that even with 13 local manufacturers and assemblers and thousands of used import cars, the segment is still out of reach of the common man due to skyrocketing taxes and duties.
A consistent and favorable policy to encourage the local auto industry enables it to become more productive towards boosting the industry. Compared to the local manufacturing industry, the import of used cars does not employ many people.
The import process involves a few people, often from the same family, with one sitting in Japan and the other sitting in any Pakistani city engaged in a black market business that only seeks to serve the luxury lifestyle. On the other hand, local car manufacturers are a valuable economic asset of our country.
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IMPORT OF NEW CARS SHOULD BE ENCOURAGED TO SHOW THE LOCAL MANUFACTURERS A MIDDLE FINGER. THESE LOCAL MANUFACTURES ARE NOT EVEN MEETING AN IOTA % OF THE INTERNATIONAL STANDARDS OF CARS STANDARDS. THE LOCAL MANUFACTURED CARS ARE SUBSTANDARDS AND HAVE NO WORTH FOR EXPORTS DUE TO THEIR POOR QUALITY BUT THEIR PRICES ARE TOOOOO MUCH HIGH AS COMPARED TO THE IMPORTED CARS.
I SUGGEST LET THE IMPORT OF CARS BE FLOURISHED TO COMPEL THE LOCAL MANUFACTURERS TO MEET THE INTERNATIONAL STANDARDS OF CAR MANUFACTURING AND BRING THEIR PRICES EQUAL TO IT. THIS WILL HELP IN EVEN EXPORT DEMANDS AND LOCAL AND INTERNATIONAL COMPETETION IN STANDARD MANUFACTURING. AUTOMATICALLY LOCAL CARS DEMAND WILL RISE.
Cries of looters
Pakistani co raised unnecessary prices In 2 years and now reluctant to reduce price , why to ban a quality car and cheaper as well , with the poor quality local car manufacturers are getting very high prices , either they should red 25% price or let compete with better cars
1 crore+ for a civic with many missing features available in other countries .
80 lac for old generation corolla (same design since 2014)
70 lac for old generation Elantra which was launched in 2017 and no longer manufactured or sold anywhere else since 2020
Local assembly of cars should be stopped altogether. All vehicles should be imported new or used. The local assemblers/manufacturers exploit the people’s needs and resort to loot and plunder. They need to be taught a lesson.
Aslaam Pakistan is middle class country all man afford 10 year old car is in budjet import car govt oprove he policy legal import for 5 year at least policy local car manufacture get high profit and make low standard material and body parts not high feather air bag low quality govt already get high revenue for import old car hardly action to local made car to low price at least 25 lak per car and Suzuki less 10 lak small car alto mehran thnks
Please clarify. How has the import of used cars cost the country RS. 50 billion?
In 2020 when used car imports were restricted, FBR itself admitted to loosing tax revenue because of it of over RS. 22 billion in the FIRST 7 MONTHS of that fiscal year. Taxes are paid on the imported cars as well as registration etc. They have always been a good source of tax collection; now targeted by these local assemblers and their damaging rhetoric.
Morocco has 60% localization in its auto sector. Last year it brought in over 8 billion USD in export profits to that country. Have our local companies EVER done anything like that?!
Sultan ka khoo, bilal gunj, Shoba bazar and many other such markets around the country are a testament to how many jobs the imports and kabali parts have created. The true job centers and skills providers of the nation.
Lastly didn’t the local Japanese assemblers just sue Pakistan for wanting them to have at least 10% of their production capacity for exports. A very reasonable condition but they sued the country instead. What business ethic!!!
Thirty years and they are still crying about more handouts! Thirty years and they are still net importers of parts!
This is simply one type of importer trying to bad mouth and ban another type to corner the market.