‘Govt’s plan to relax vehicles’ import to inflict big dent to local auto industry’

KARACHI: Government plans to allow the import of used vehicles up to five years old could severely damage Pakistan’s local auto industry, warned Muhammad Ali Tabba, Chairman of Lucky Group, which owns Lucky Motors Corporation (formerly KIA Lucky Motors).

Speaking to Hum News English on Saturday, Tabba said such a policy would turn the country into a “junkyard” for old vehicles and undermine ongoing efforts to promote electric vehicles (EVs).

Currently, Pakistan permits the import of used passenger cars up to three years old, and SUVs up to five years, under specific schemes. The Federal Board of Revenue (FBR) is now considering a uniform policy that allows the import of all vehicle categories up to five years old, as part of the upcoming 2025–26 budget.

Tabba criticized the apparent lack of coherence in government policy, noting that subsidies for EVs contradict the allowance of older petrol and electric vehicles with limited battery life. “These batteries last five to six years—how will Pakistan manage their disposal?” he asked, adding that developed nations were effectively exporting their environmental liabilities to Pakistan.

Calling the policy “absolutely wrong,” Tabba questioned the rationale behind such decisions and dismissed any suggestions that they were being made under IMF pressure. “This is the government’s own shortsightedness,” he asserted.

Sazgar all set to introduce new energy vehicles in Pakistan 

He also warned of broader economic repercussions. “The local auto industry is already running at just 40 per cent capacity. If this policy is implemented, it will collapse—leading to massive unemployment and disrupting the entire local vendor and parts supply chain,” he said.

Tabba further pointed out that the local industry has evolved beyond the traditional monopoly of three automakers, expanding to eight players with healthy competition. “The government is still thinking in outdated terms. This is no longer a monopolized market,” he emphasized.

He urged the government to reconsider, hoping it will make the right decision for the future of Pakistan’s auto industry.