Rise in Used Car Imports Denounced by Pakistan’s Auto Industry

The surge in used car imports in Pakistan has raised concerns within the country’s auto industry, with industry leaders denouncing the impact of these imports on local manufacturers. Ali Asghar Jamali, the CEO of Indus Motor Company (IMC), expressed his dismay at the situation, particularly considering it is occurring during a period of import control measures.
Jamali highlighted that the continuous increase in used car imports has severely affected the local auto industry. In the financial year 2022-23, more than 6,000 used cars were imported into Pakistan, with over 1,200 units arriving in May and June of the same year. This trend threatens the localization targets achieved by Pakistan’s auto industry.
The CEO stressed the need for a well-designed import policy that supports the local auto industry. He pointed out that, especially when foreign exchange reserves are minimal, the government should refrain from permitting imports of used cars and instead prioritize policies that encourage domestic car production.
Jamali emphasized the vital connection between the growth of the auto industry and a carefully planned import policy. He stated that this growth could never be realized when continuous imports undermine local production efforts.
Despite the challenges faced by the auto industry, including restrictions on opening Letters of Credit, Jamali revealed that IMC had not laid off any employees, demonstrating its commitment to the country and its workers.
Regarding the issue of hybrid electric vehicles (HEVs), the CEO highlighted Pakistan’s vulnerability to climate change. According to the Global Carbon Budget 2022, Pakistan’s annual CO2 emissions increased to 229.51 million tons in 2021, a 9% rise compared to 210.38 million tons in 2020.
Jamali underlined the importance of HEVs as a sustainable solution to economic problems. HEVs can contribute to achieving macroeconomic goals, generate employment, boost exports, and reduce imports. He mentioned that Toyota had invested $100 million in Pakistan to produce HEVs, and the launch of the Corolla Cross, Pakistan’s first locally manufactured HEV SUV, is imminent.

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