Pakistan’s automotive industry is truly amazing when it comes to growth and expansion. The sector has grown immensely in a very short period of time.

“Pakistan’s economy is shaping up and recent testimonials on the country’s economy by renowned world institutes confirm that Pakistan is the 3rd fastest growing economy,” Aamir Allawala, former chairman PAAPAM

The economic growth had outdone the auto industry, as companies have not only seen a rise in sales but also experienced a growth in their stocks as well. Car sales crossed 230,000 last year and have continued to grow by 10 to 15 percent every year. Similarly, bike sales are higher than ever at 1.21 million.


“Currently, Pakistan has 16 vehicles per 1000 people and per capita income is $1400, which is leaving it behind against India (18 vehicles), Philippines (30 vehicles), Indonesia (69 vehicles), Thailand (206 vehicles), and Malaysia (361 vehicles),”-Aamir Allawala

With the new automotive policy inviting international car brands, day by day a new window is being opened for investors to come, explore, and invest not millions but billions in this sector! To give you a better idea of how the stocks have seen an increase over the years here’s a simple chart to show growth in 5-years span.

“Pakistan can learn from Indonesia since both the countries have similar factors but Pakistan is way behind in motorization,” he said. He added that Indonesian automobile industry achieved growth from 379,000 vehicles in 2000 to 1298000 vehicles in 2014 and this growth was triggered by economic stability and young population.

“Pakistani auto industry has recovered from the 2010 crisis so it can achieve the same growth in next few years,” he added. According to Japanese International Cooperation Agency’s estimation of Pakistan auto market potential, approximately 480,000 new vehicles per year could be sold in a country of the scale of Pakistan economy (GDP and population). “But currently not even half of the estimated vehicles are sold every year in the country,” he added.

He said that local market size growth could reach to 500,000 vehicles by 2020 as economies of scale will enable long-term investments. “The industry (OEMs and Vendors) are investing in capacity enhancement though it requires long-term, predictable policy framework,” he said.

Aamir said that more auto production leads to more localization of parts, more foreign and local investment, employment generation, and more government revenues. “The government’s support through stable policies would help the local auto sector increase its production and increase motorization in the country,” he added.

He said, ‘Auto policy is bearing fruits, new players are eager to enter the market which will not only result in growth of industry but more choices for customers. However, Government needs to be very cautious and ensure continuation of policies to provide predictable environment as we are still paying for deviation from policies in past such as opening used cars import,’ he concluded.