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Rising Demand Drives Record Growth in Pakistan’s Auto Sector
Pakistan’s automotive industry has experienced a significant upswing in the fiscal year 2024-25, with car sales witnessing a notable 43% rise. This surge has been driven by a combination of favorable economic conditions and strategic market developments. The total number of vehicles sold, including cars, jeeps, and pick-ups, reached 148,023 units, compared to 103,829 units in the previous fiscal year.
June 2025 marked a particularly strong month for the sector, with sales hitting 21,773 units. This represents a 64% year-on-year (YoY) increase and a 47% month-on-month (MoM) growth. Analysts believe this upward trend is fueled by several factors, including a more stable macroeconomic environment, lower interest rates, the introduction of new vehicle models, and a growing sense of consumer confidence.
The auto sector has seen widespread growth across various segments. Jeep and pick-up sales saw an impressive 61% increase, while truck and bus sales recorded even higher growth. Truck sales rose by 103.2%, and bus sales climbed by 73.6%. Motorcycle and rickshaw sales also showed positive momentum, increasing by 32.1% throughout the year, with over 1.5 million units sold.
Despite these gains, one segment faced challenges. Farm tractor sales declined by 36.4%, dropping to 29,192 units. Industry experts point to climate-related issues and low agricultural prices as key reasons for this downturn. These factors have placed financial strain on farmers, leading to reduced demand for tractors.
A major contributor to the overall growth in vehicle sales has been the sharp decline in interest rates and the availability of more flexible leasing options. These changes have made it easier for consumers to access financing, encouraging them to upgrade from older vehicles to newer models. According to auto analyst Muhammad Sabir Shaikh, the shift reflects a broader trend of improved buyer sentiment.
Looking ahead, the optimism in the market suggests that the momentum will continue into the next fiscal year. The combination of economic stability, competitive pricing, and innovative product offerings is expected to sustain the upward trajectory of the auto sector.
Key Highlights of the Fiscal Year 2024-25 Automotive Growth
- Car Sales: Increased by 43% to 148,023 units.
- June 2025 Performance: Recorded 21,773 units sold, showing a 64% YoY and 47% MoM increase.
- Jeep and Pick-Up Sales: Rose by 61%.
- Truck and Bus Sales: Jumped by 103.2% and 73.6%, respectively.
- Motorcycle and Rickshaw Sales: Grew by 32.1%, with over 1.5 million units sold.
- Farm Tractor Sales: Dropped by 36.4% due to climate and economic challenges.
- Interest Rates and Leasing Options: Played a crucial role in boosting consumer purchasing power.
As the sector continues to evolve, stakeholders are closely monitoring the impact of policy changes, inflation trends, and global market conditions. With a strong foundation laid in FY2024-25, the future looks promising for Pakistan’s automotive industry.
