Pakistan’s Automobile sector posts growth in 2016-17 fiscal year

Pakistan’s automobile sector witnessed a modest growth in the fiscal year that ended on June 30, with jeeps and cars production rising by over 5 percent that of motorcycles by 20.7 percent, according to the official statistics.

Pakistan’s automobile sector has witnessed growth in the past three years and employs about 120,000 people. The sector contributes 12 billion rupees to the GDP and 30 billion rupees to the national exchequer in terms of taxes and duties.

The industry has long been dominated by Japanese brands including Honda, Toyota and Suzuki. But since the announcement of a new auto policy in 2016, which offers tax incentives to new automakers, world top brands such as Renault-Nissan, Korea’s Kia and Hyundai and Audi and Volkswagen have expressed their interest in entering the Pakistani market.

In the 2016-17 fiscal year, Pakistan produced 190,466 jeeps and cars compared to the production of 180,717 during July-May (2015-16), according to Pakistan Bureau of Statistics (PBS). Motorcycle production increased by 20.74 percent to 25,006,50 units.

The production of tractors also increased from 34,814 units to 53,975 units, showing increase of 54.59 percent while the output of trucks increased from 5,666 units to 7,712 units, an increase of 36.11 percent. However, the production of light commercial vehicles (LCVs) witnessed negative growth of 32 percent by declining from 35,836 units to 24,265 units.

Meanwhile, on year-on-year basis, the production of motorcycles increased by 9.04 percent by going up from output of 187,825 units in June 2016 to 204,804 units in June 2017 while the production of trucks increased by 1.16 percent by increasing from 601 units in June 2016 to 608 units in June 2017.

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