Honda Atlas Cars Pakistan (PSX: HCAR) is deliberately keeping the Honda City priced at around Rs. 4.9 million so the sedan remains below Rs. 5 million or buyers will be forced to pay 25 percent sales tax instead of 18 percent.
In a corporate briefing session, HCAR said vehicles priced above Rs. 5 million are subject to the higher 25 percent sales tax. They said Honda City currently contributes around 70 percent of the company’s total sales, making it the automaker’s biggest-selling model.
Honda Atlas also disclosed that its profit margins remained under pressure throughout MY26 as the depreciation of the Thai baht against the US dollar increased the cost of imported parts. The company said it did not fully pass these higher costs on to customers because City’s dominant sales further weigh on margins as it attracts the lower 18 percent GST.
HCAR said the government has proposed increasing customs duty on certain hybrid vehicle components from 4 percent to 5 percent, but it isn’t final yet. It added that duties on CKD non-localized parts remain at 30 percent, while localized parts continue to face 46 percent customs duty.
Imported completely built-up (CBU) vehicles are now subject to 30-50 percent customs duties depending on engine size, while applicable imported components attract 4 percent Additional Customs Duty (ACD) and 8 percent Regulatory Duty (RD).
HCAR said it expects Pakistan’s auto industry to grow by around 25 percent year-on-year and remains optimistic about maintaining or increasing its market share.
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