Following the recent duty and tax incentives for the auto industry in Pakistan, the sector is expected to register robust growth in 2022, say experts.
Despite the looming economic challenges, experts foretell an increase in the coming year as the auto sales jumped around 90% during the first 11 months of the calendar year in 2021, The News reported. In the first 11 months, auto companies registered with Pakistan Automotive Manufacturers Association sold 210,048 units as compared to 110,540 units during the same period last year.
“2021 saw a pickup in the economic activity resulting in higher demand for automobiles,” said analyst Arsalan Hanif, adding that a lower policy rate during the year helped car sales in the country.Auto financing increased to Rs346 billion by October 2021, surging 44% year on year. “But the high percentage increase in the auto sales in 2021 was due to low base effect. The year 2020 had been badly affected by the pandemic,” Hanif added.
In an effort to give a boost to the auto sector and provide affordable cars to the public, the government reduced taxes, decreasing FED on vehicles across the board and reducing sales tax for cars below 1000cc cars, which resulted in a reduction in car prices whereas increase in sales.The current year saw the launch of new car models in the country namely Honda City, Changan Alswin, Proton Saga, X70, Hyundai Elantra, Sonata, KIA Sorenta and Stonic.