Automobile Industry

updated 27 Jan 2010!
Compiled by: Mirza Rohail B 

Pakistan is an emerging market for automobiles and automotive parts offers immense business and investment  production-volume-2007-081opportunities. The total contribution of Auto industry to GDP in 2007 is 2.8% which is likely to increase up to 5.6% in the next 5 years. Total gross sales of automobiles in Pakistan were Rs.214 billion in 2006-07 or $2.67 billion. The industry paid Rs.63 billion cumulative taxes in 2007-08 that the government has levied on automobiles.There are 500 auto-parts manufacturers in the country that supply parts to original equipment manufacturers (PAMA members). Auto sector presently, contributes 16% to the manufacturing sector which also is expected to increase 25% in the next 7 years, as compared to 6.7 percent during 2001-02.Vehicles’ manufacturers directly employ over 192,000 people with a total investment of over $ 1.5 billion. Currently, there are around 82 vehicles’ assemblers in the industry producing passengers cars, light commercial vehicles, trucks, buses, tractors and 2/3 wheelers. The auto policy is geared up to make an investment of $ 4.09 billion in the next five years thus, making a target of half a million cars per annum achievable.

Government of Pakistan had undertaken two major initiatives in the form of National Trade Corridor Improvement Program (NTCIP) and Auto Industry Development Program (AIDP) for the development of the automotive industry in Pakistan.

Engineering Development Board (EDB) is actively implementing the AIDP to increase the GDP contribution of the automotive sector to 5.6%, boost car production capacity to half a million units as well as attract an investment of US$ 3 billion and reach an auto export target of US$ 650 million.

Automotive engineering is a driving force of large scale manufacturing, contributing US$ 3.6 billion to the national economy and engaging over 192,000 people in direct employment.

The Auto parts manufacturing is $ 0.96 billion per annum. The demand for auto parts is highest in the motor cycle industry which is 60%, then is for cars which constitutes to 22% and the rest 18% is consumed by trucks, buses & tractors. This demand is met by Imports which caters 22% while the remaining 78% is supplied by the local manufacturers.

Due to the increase in demand for sophisticated machinery, the government has allowed duty free import of raw 

Honda Civic

Honda Civic

material, sub components, components assemblies for manufacturers & assemblers. Total import bill of machinery stands at $2.195 billion in the current fiscal year of 2007-08 which is 12.77% higher than that of the preceding year.

The impressive growth in the machine tools and automation sector is directly proportional to the growth of the automotive industry which has become the fastest growing industry of Pakistan and contributes $3.6 billion annually to the country’s GDP.

 The aftermarket for spares has also witnessed immense expansion over the same period, with imported parts playing an important role in meeting local demand. The spare parts market is given further impetus by a total vehicle population of approximately 5.4 million

Pakistan has the second highest number of CNG-powered vehicles in the world with more than 1.55 million cars and passenger buses, constituting 24% of total vehicles in Pakistan with improved fuel efficiency and conforming to the latest environment regulations.

 According to Government Board of Investment,

Automotive Industry  No of Units Number 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2007-08
Cars 5 164,000 40,601 62,893 99,263 126,817 160,642 176,016 164,710 84,308
Jeeps 2 3,298 1,590 932
Light Vehicles 4 32,500 8,491 12,174 14,089 23,613 29,581 19,672 21,354  
Trucks 5 17,500 1,141 1,954 2,022 3,204 4,518 4,410 4,993 3,135
Buses 5 3,900 1099 1,340 1,380 1,762 825 993 1,146 662
Tractors 3 50,000 24,331 26,501 36,103 43,746 49,439 54,610 53,607 59,968
Motor Cycles 55 733,000 133,334 176,591 327,446 571,145 744,875 839,224 1,057,751 493,592


VISION 2012: The Future of Pakistan Auto Industry

Product 2007-8 VISION 2012
Cars (nos.) 164,710 500,000
2 wheelers 1.06 million 1.7 million
Investment (Billion) 98 225
Contribution to GDP (%) 2.8 5.6
Contribution to manufacturing sector (%) 16 25
Direct Employment 192,000 500,000
Gross sales turn over (Billion) 214 600


Decline in Sales and Revenue

Unfortunately, the recent downward trend in auto sales (cars + LCVs) continued as auto sales stood at 27,034 units for July-September 2008, showing a decline of 44 percent year-on-year, the data released by Pakistan Automobiles Manufacturers Association (PAMA) shows. (Link

Automobile grew from 2001-2007, the industry and the government of Pakistan fixed a target of over half million units’ production by the year 2011-12 that now seems out of reach. The industry slightly fell short to achieve the targeted productions in 2006-07 when 1,95,688 cars were manufactured against a target of 2,26,620 units. However, there was some growth in production that year. In 2007-08 the production declined to 1,87,634 units against a projected target of 2,66,543 units. In the current fiscal year they said the production is expected to decline to 1,50,107 units that are half the projected target of 3,13,486 units.

Despite an additional levy of 5 per cent excise duty, the revenues from automobile sector would decline by over 25 per cent this year due to declining demand. The industry paid Rs.63 billion cumulative taxes that the government has levied on automobiles. This year, despite additional duty the sector would hardly contribute Rs50 billion in the national exchequer.
Automobile Manufacturers and Vendors concerns

Automobile manufacturers and auto-parts’ vendors have warned the government that despite an additional levy of 5

Chevrolet Assembly Port Qasim

Chevrolet Assembly Port Qasim

 per cent excise duty, the revenues from automobile sector would decline by over 25 per cent this year due to declining demand.

The Pakistan Association of Auto Parts and Accessories Manufacturers (PAAPAM) and Pakistan Automobile Manufacturers Association (PAMA) in a joint presentation have suggested various steps that should be taken by the government to arrest the slowdown in sales. The two associations appealed to the government to withdraw the 5 per cent excise duty on cars and impose a ban on import of used parts instead of allowing their import after imposing 30 per cent redemption duty.

They asked the government to place stringent checks on auto-parts imported commercially or as semi knock out kits. They proposed the introduction of non-tariff measures to curb the import of parts that are being manufactured in Pakistan. They pointed out that the 50 per cent duty has failed to stop the import of these parts as the import prices are easily manipulated by the importers. Moreover, import under SRO 63 attracting 50 per cent duty should not be allowed under FBR’s CARE system. They have also appealed for special incentives for the auto sector including lower mark-up on loans and a waiver of 35 per cent L/C margin.

The two associations pointed out that investment in the automobile sector has frozen at Rs98 billion and is expected to remain at the same level by 2011-12.

Honda Atlas Cars Pakistan Ltd

Honda Atlas Cars Pakistan Limited is a joint venture between Honda Motor Company Limited Japan, and the Atlas  honda-plant1 Group of Companies, Pakistan. The company was incorporated on November 1992 and joint venture agreement was signed on August 1993. The ground breaking ceremony was held on April 17, 1993 and within a record time of 11 months, construction and erection of machinery was completed. The first car rolled off the assembly line on May 26, 1994. Official inauguration was done by President of Pakistan, Sardar Farooq Ahmad Khan Leghari. Mr Kawamoto, President of Honda Motor Company Limited Japan was also present to grace the occasion. The company is listed on Karachi, Lahore and Islamabad Stock Exchanges. In July 1994, car bookings started at six dealerships in Karachi, Lahore, and Islamabad. Since then the Dealerships Network has expanded and now the company has sixteen 3S (Sales, Service and Spare Parts) and thirty 2S (Service and Spare Parts) Pitstops network in all major cities of Pakistan. Since the commencement of production in 1994, the company has produced and sold more than 150,000 cars till Oct, 2008. All dealerships are constructed in accordance with the standards defined by Honda World over.  

Indus Motor Company

Indus Motor Company (IMC) is a joint venture between the House of Habib, Toyota Motor Corporation Japan (TMC),  Daihatsu Motor Company Ltd vehicles in Pakistan through its dealership network. The company was incorporated in Pakistan as a public limited company in December 1989 and started commercial production in May 1993. The shares of company are quoted on the stock exchanges of Pakistan. Toyota Motor Corporation and Toyota Tsusho Corporation have 25 % stake in the company equity. IMC’s production facilities are located at Port Bin Qasim Industrial Zone near Karachi in an area measuring over 105 acres. Indus Motor company’s plant is the only manufacturing site in the world where both Toyota and Daihatsu brands are being manufactured. IMC’s Product line includes 6 variants of the newly introduced Toyota Corolla, Toyota Hilux Single Cabin 4×2 and 4 versions of Daihatsu Cuore.



Toyota Tsusho Corporation Japan (TTC) for assembling, progressive manufacturing and marketing of Toyota vehicles in Pakistan since July 01, 1990. IMC is engaged in sole distributorship of Toyota.

Pak Suzuki Motor Company

Pak Suzuki Motor Company Ltd (PSMCL), established as a joint venture between Suzuki Motor Corporation of Japan (SMC) and Pakistan Automobile Corporation (PACO) Govt. of Pakistan in 1983. Started commercial operations with production (S.O.P.) of Suzuki FX in 1984. In 1992, started production of MARGALLA at new Plant. In 1997, started production of 1300cc BALENO replacing Margalla. In 2001, launched the CNG version of MEHRAN, RAVI and BOLAN. By 2005 capacity expansion up to 80,000 vehicles per year were completed. In 2006, capacity expansion up to 120,000 vehicles per year was completed and production of 1300cc/1600cc car LIANA and BALENO commenced. In 2007, the third  balenophases of capacity expansion up to 150,000 vehicles per year were completed. Amalgamation of Suzuki Motorcycle Pakistan Ltd into Pak Suzuki Motor Company Ltd took place and new land of 120 acres was acquired for further expansion adjacent to current plant. In 2008, the company started exporting Suzuki LIANA to Bangladesh. Pak Suzuki acquired a land of 25.22 acres at Lahore for setting up PDI centre, Spare Parts Ware-house, Regional Office and other related facilities.

Nexus Automotive

Chevrolets were sold in Pakistan well into the 1970s, after which the automotive regime was changed and Chevrolet  chevoletgradually withdrew to its home market in the United States. In 2004, after an absence of three decades, Chevrolet was re-introduced in Pakistan. Once again, a global brand with a product line-up suited to developing markets such as Pakistan, Chevrolet has made a successful return to the country. Working with Nexus Automotive, General Motors’ partner in Pakistan , Chevrolet can once again be seen on roads all over the country. Today, Nexus Automotive assembles the 1000cc Chevrolet Joy at Port Qasim (Sindh), and imports a broader line-up of cars, including Aveo, Optra, and Colorado (coming soon) from the General Motors global network.

Al-Ghazi Tractors

Al-Ghazi Tractors Limited (AGTL) was incorporated in 1983. In 1991 the project was offered for privatization, and

Al Ghazi Tractors

Al Ghazi Tractors

acquired by Al-Futtaim Group of Dubai who took over the management control of AGTL in December 1991. Ever since  AGTL is a case study of rollicking corporate success. 50.02% shares of the company are held by Al-Futtaim Industries Co. LLC and 43.17% shares are held by CNH Global NV, with whom Al-Ghazi Tractors Limited has signed an Industrial Collaboration Agreement for manufacture of New Holland brand tractors. The Agreement is valid till April 2016. With expansions carried out in 2005, the plant is now capable of producing 30,000+ tractors per year in a single shift – the most enduring competitive edge being the quality of our tractors, which are robust
and sturdy and carry a local content as high as 92%. AGTL was the first automobile company in Pakistan to earn the ISO-9002 Certificate.

Dewan Motors

Dewan Farooque Motors Limited has one of the most advanced automobile assembly plants of South Asia. Located at

Dewan Motors

Dewan Motors

Dewan City, Sujawal, Thatta, with a total project cost of Rs. 1.8 billion, the plant is built on an area of 42,000 square meters. Selection of the site reflects the commitment of Dewan Group towards building of a prosperous Pakistan and its contribution to national wealth. The project has provided direct employment to over 700 personnel. The plant is the first automobile manufacturing unit in Pakistan to be independently invested by 100% Pakistani investors. The annual capacity of the plant is 10,000 units on a single shift basis. The groundbreaking ceremony for the plant was held in June 1999, and the first Kia Classic rolled-out in a record time of six months. Today the modern state-of-the-art plant is rolling-out cars every day. This is the first and only automobile assembly plant in Pakistan with state of art robotic equipment. Dewan Farooque Motors Limited has technical collaboration and license agreements with the following Korean companies:
Hyundai Motor Company – December 25th 1998
Kia Motors Corporation – July 27th 1999

Ghandhara Industries

The Ghandhara Industries Limited is a public limited company quoted on the Stock Exchanges and registered under the Companies Act, 1913 (now companies Ordinance, 1984). It was established in Karachi by General Motors Overseas Distribution Corporation U.S.A. in 1963 Lt. Gen. M. Habibullah Khan Khattak acquired these facilities from General Motors and renamed it Ghandhara Industries Limited. The Government of Pakistan nationalized Ghandhara Industries Limited in 1972 and renamed it National Motors Limited. In 1992 M/s. Bibojee Services (Pvt) ltd. acquired it under Privatization Policy of the Government, and adopted its original name Ghandhara Industries Limited w.e.f. 27-11-1999. The major business activities of the company comprise of progressive manufacture, assembly and marketing Isuzu truck and bus chassis and fabrication of Bus and Load bodies.  Ghandhara industries Ltd have a product range of ISUZU medium-duty vehicles (F-Series) & light-duty Vehicles (N-Seies) in Pakistan.

Hino-Pak Motors Ltd

Hino Motors Japan and Toyota Tsusho Corporation in collaboration with Al-Futtaim Group of UAE and PACO Pakistan formed Hinopak Motors Limited in 1986. In 1998, Hino Motors Ltd., and Toyota Tsusho Corporation obtained majority shareholding in the company after disinvestments by the other two founding sponsors.

Adam Motor Company

We would do great injustice if we fail to mention, the only large scale effort made by a Pakistani to achieve what others  adamfailed to implement or even envision. Mr.Feroz Khan, founder of the Adam Motor Company, Ltd. was an automobile assembler based in Karachi, Pakistan. They were notable for producing the Revo, which was Pakistan’s first homegrown company to assemble a decent car. Together with styler Mehmood Hussain, Chief Engineer N. A. Salmi and two fresh graduates from NED, Khan designed and manufactured Pakistan’s first car. In fact, Khan invested in the latest software programs to train his team using Computer Aided Design (CAD) and Computer Aided Manufacturing (CAM). Khan is also Chairman and CEO of Omar Jibran Engineering Industries and has twice been Chairman of Pakistan Association of Automotive Parts and Accessories Manufacturers. All their vehicles used Made in China components due to lack of a modern manufacturing industry in Pakistan. Initially Adam Motor was involved in assembling cheap Made in China light trucks, followed by a Made in China four-wheel drive off-road vehicle. Later they started manufacturing the Revo. The 800CC version of the Revo costs Rs. 269,000 (about $4,500) and the 1050 model is Rs. 369,000 (about $6,200). The Revo has also been built in accordance with EU safety regulations. Mr. Feroz Khan blames the politicians for the company’s failure.

Related Links

Auto Pakistan 

Pakistan Automobile Industry Statistics

Automobile sector Revenue declines by 25%

Government attaches importance to Automobile Industry: PM Shaukat Aziz


This Article has been Referenced in:

1- Automobile Industry –

2- EMESAP International Management

3- Final Term Paper – Robert Kennedy College (Scribd)




Filed under Automobile Industry, Industrial sector, Pakistan Economy

25 responses to “Automobile Industry

  1. The current auto update about vehicle production in year 2008, i got the report in recently from local magazine, i am subcriber of the said magazine thats why i have update information about it.

    According to the report which was published in February 2009 issue of Mobile World.

    The number of vehicles produced in country declined in the second half of last year to 59,288 from 96,448 units produced during first half in contrast to installed capacity of 383,922 units.

    It may be mentioned here that out of total number of 19 registered four wheeler assemblers 4 have already abandoned the assembling activities. Out of remaining 15 manufacturers M/s Pak Suzuki Motor Company was the top producer during July to December 2008 by making a total of 34,607 vehicles of six different types.

    Indus Motor Company was the second highest who produced 14,844 vehicles of three different kinds followed by Honda Atlas Cars who produced only two brands making a total of 6,154. Dewan Farooque Motors with 1,413 and Nexus Automotive with 197 were the other car manufacturers in the line.

    Sigma Motors, assemblers of Defender Jeep produced only 13 units in six months while Sindh Engineering had manufactured 25 Dong Feng light Trucks and Dewan Automotive Engineering formerly known as Delta Innovations produced 2 Star Trucks only. Similarly, Karakoram Motors produced 43 Kalash pickups.

    M/s Hinopak Motors was the leading manufacturer of heavy/ light duty trucks, dumpers, semi trailers, prime mover and bus segments which produced a total of 1,062 vehicles. Ghandhara Nissan followed through manufacture of 315 including 24 Nissan Sunny cars and Ghandhara Industries produced 308 Isuzu vehicles while Afzal Motors made 85 Daewoo vehicles and Bibojee Services produced 8 Kamaz prime movers.

    M/s Raja Motor Company, Adam Motor and Transmission Motor were the companies whom had abandoned the manufacturing of Fiat UNO car, Zabardast truck and Alif car, Bay pickup respectively. Similarly, M/s Roma Motor Company was the assembler of Roma Mini truck.

    During this period Suzuki pickup was the most demanded vehicle for Pak Suzuki Motors that topped by 9,267 in the company followed by 7,853 Mehran, 6,301 Bolan, 6,133 Cultus, 4667 alto and 386 Liana cars.

    Toyota Corolla was the favorite from Indus Motors with 10,130 units followed by 4,003 Daihatsu Cuore and 711 Hilux pickups. Honda produced 3,301 Civic and 2,853 City cars. Dewan Farooque produced 1,320 Shehzore pickup and 93 Hyundai Santro cars while Nexus Automotive assembled 197 Chevrolet Joy cars.

    It may be mentioned here that Pak Suzuki has installed capacity of 150,000 units, Indus 50,000, Honda 50,000, Dewan Farooque 10,000, sigma Motors 1,000, Sindh Engineering 3,000, Mater Motor 8,500, and Roma Motor 572.

    In truck and bus assembling segment Hinopak has installed capacity of 5,950 vehicles, Ghandhara Nissan 2,200 trucks & buses and 6,000 Nissan sunny cars, Ghandhara Industries 3,000, Afzal Motors 3,000 and Bibojee Services 200 units, respectively.

  2. Administrator

    Mr Ejaz Iqbal,
    Many thanks for your updated input. Its much appreciated. Looking forward to more contribution. Best Regards!

  3. thanx your work help me a lot. nice work. best regards

  4. the website is really informative but i am finding the future outlook of automobile sector of pakistan but i could not search material on i from your website

  5. the website is not fully informative, you must include some more information on automobile industry of Pakistan

  6. tawhid1982

    What is the total number of cars produced annually in Pakistan?

    Who are the largest automobile producers and how many automobiles do they produce annually?

  7. Pingback: Arab News Blog

  8. Pingback: Enduring America

  9. What is the total number of cars produced annually in Pakistan?

    Who are the largest automobile producers and how many automobiles do they produce annually

  10. Administrator

    Dear Tawhid1982 and Babar,
    Number of Cars produced annually in Pakistan are as follows, according to Government Board of Investment.
    2001-02 – 40,601
    2002-03 – 62,893
    2003-04 – 99,263
    2004-05 – 126,817
    2005-06 – 160,642
    2006-07 – 176,016
    2007-08 – 164,710
    2007-08 – 84,308

    Additionally, we’ll try to upload the figures for the overall Automative Industry in Pakistan. Thanking you for visiting Economic Pakistan. Looking forward to your feedback,

  11. tawhid1982

    For some reason, my questions were repeated by Mr “Babar Irshad”.

    Thanks to the administrator for your informative comment.

    When does the Pakistani Fiscal Year start/end?

  12. Administrator

    Dear Tawhid1982,
    Kindly, we apologize for the late reply. Certainly orginally the question was from you. Inaddition, the Pakistani Fiscal year starts 1st July and concludes on 30th June. Looking forward to your participation. Regards.

  13. tawhid1982

    Thank you for the information.

  14. Pingback: The Compulsive Explainer

  15. Pingback: Cherish President Musharraf « Our leader – Musharraf

  16. faisal

    i required a latest GDp growth in autombile sector and growing strateby spacialy in motocycle industry


    very very thank u for help. I like ur web site.

  18. malikhumzayunasnandla

    really the great pics i like it

  19. adnan

    what is the number of units which are financed by banks pan pakistan in last five year. may be you can tell in terms of percentage

  20. i m ibrahim ,my education intermediate and applied DAE auto and diesel technology 3rd year student ,,,,so please give me job …………thanks

  21. nice blog, I will waiting the next post. best wishes

  22. Alia

    kindly i need a data on bigplayers in auto industry since 2008 to 2011 and their sales statistics too.if anyone can help send me an email on



  24. Pingback: Overall Vision of Our leader – Musharraf | Our leader - Musharraf

  25. Pingback: President Musharraf’s Vision and Achievements of his tenure | Our leader - Musharraf

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s