Govt Eyes Locally Producing 500,000 Cars Per Year And Earn $1 Billion in Exports

The federal government is working on an ambitious revival plan for its struggling automotive sector under the draft Auto Policy 2026–31, with an aggressive annual production target of 500,000 cars, higher export, and normalizing electric vehicle adoption within the next five years.

ProPakistani has learnt that the aim is to raise annual vehicle production to more than 500,000 units by 2031, a sharp turnaround from the sector’s collapse to just 56,000 units in FY2022-23 after peaking near 300,000 units in FY22.

Beyond boosting output, the government is targeting US$ 1 billion in automotive exports. This figure would represent a genuine breakthrough for a sector that has historically been inward-focused.

Perhaps most radical is a high New Energy Vehicle (NEV) share target for new vehicle sales. The policy sets a target for NEVs, including electric and hybrid models, to account for 30 percent of all new vehicle sales by 2031. To support this transition, authorities plan to establish 3,000 EV charging stations nationwide to fast-track large-scale electric adoption.

The agriculture segment has also been included in the roadmap. When approved, the government is targeting an annual production of 100,000 units to improve farm mechanization and productivity.

Following one of the deepest downturns in Pakistan’s auto industry history, the draft policy aims to rebuild manufacturing capacity, encourage exports, and accelerate the transition toward sustainable transportation. This is something the country desperately needs.