We have a small variety of cars available in Pakistan that are assembled locally. In fact we shouldn’t be using the word ‘variety’ at all, since all what we get is a handful of options offered to us by three dominant players that never rival another in terms of price or segment.
However the same automakers responsible for putting together CKD components to be able to sell these cars in our country have some imported cars offered under their portfolio too. But due to outrageous import duties, which are in fact placed to protect the local industry, the prices of these imported cars are beyond the limits of sanity.
Still automakers launch these expensive imported cars in Pakistan which are otherwise considered rather ordinary everywhere else in the world. These cars barely serve any purpose and remain standing at the showroom floors. Some of these imported cars offered by local automakers that never really contribute to sales are listed below:
|Toyota Prius||PKR 83.7 lac|
|Toyota Rush||PKR 52.2 lac|
|Toyota Camry||PKR 1 Crore 65 lac|
|Honda CR-V||PKR 1 Crore 7 lac|
|Honda Accord||PKR 1 Crore 19.99 lac|
|Hyundai Ioniq||PKR 63.99 lac|
|Hyundai SantaFe||PKR 1 Crore 85.0 lac|
|Suzuki APV||PKR 34.6 lac|
|Suzuki Jimny||PKR 39.9 lac|
|Suzuki Vitara||PKR 55.5 lac|
Most of these cars don’t even sell a dozen units in the entire year. However a few including Suzuki Vitara, Toyota Rush etc were seen in limited numbers but that too were sold initially when the cars were newly launched. Later on, hardly any unit was able to find buyers in decent numbers.
Some of such imported cars that failed to create any impact were discontinued after a brief stint including the Suzuki Kizashi, Honda CR-Z Hybrid, Honda HR-V, Toyota Avanza and most recently the Suzuki Ciaz which wasn’t too expensive after all, but Pak Suzuki’s lack of interest in this car was the primary reason behind its demise.
We believe there is no point in imposing outrageous duties on these cars which are considered rather ordinary everywhere else. For example, how much a government will earn from a PKR 1.07 crore Honda CR-V (in duties & taxes) when not even a dozen units are sold in the entire year. Contrary to this, if duties are reduced and CR-V is priced around 7 million will bring exceptional results and with sales even as low as 50-100 odd units a month can bring loads of revenue in shape of duties, taxes & registration etc to the national exchequer. It is beyond understanding that how much a PKR 1.07 crore CR-V that keeps standing on the showroom floors is beneficent for the consumer or the auto industry or the government treasury?
According to FBR, the auto sector has shown decline of 39% in income tax and 28% in sales tax, when compared with data from last year. Only Rs 47 billion has been collected during July-January (2019-20), against expected collection of Rs 88 billion, resulting in budgetary loss of more than Rs 40 billion.
Furthermore as pointed out by CEO of Kia Lucky Motors Mr Asif Rizvi, the government should focus on enhancing the production volumes. Charging
In addition to redefining polices related to local assembled vehicles, the government should also consider reworking on the import policy because it might help them generate good revenue in form of duties & taxes and registrations etc. Besides, as most people argue, if assemblers need to import everything including CKD kits to engine & transmission etc to just put them together here, why not simply open up the imports? According to the Chairman All Pakistan Motor Dealers Association, H.M. Shahzad:
The government wants to control foreign exchange outflows by restricting car imports. But it should also do something about $818m that local assemblers spent on importing completely and semi-knocked down kits in 2018-19.
What is your opinion regarding the prices of imported cars in Pakistan? Let us know with your comments.