Pakistan’s auto market: Inflation down, but car prices up. Are policies favoring the elite over the everyday buyer?
The Pakistani automotive market is a fascinating paradox. While the government heralds a decline in inflation, car prices continue their relentless climb, leaving car enthusiasts and everyday citizens bewildered and frustrated.
This stark contrast between economic indicators and market realities raises questions about government policies, spending priorities, and the accessibility of what was once considered an achievable aspiration—owning a car.
Consider this: in 2019, a Toyota Yaris ATIV CVT 1.3, a popular choice for middle-class families, was priced between 2,300,000 and 2,500,000 rupees.
Today, that same car costs a staggering 5,604,000 rupees.
Similarly, the Suzuki Alto VX, a budget-friendly option, has more than doubled in price, from around 1,000,000 rupees in 2019 to 2,331,000 rupees today.
Even the iconic Toyota Corolla and Honda Civic, once symbols of attainable automotive ambition, have seen their prices skyrocket, leaving many enthusiasts feeling priced out of the market.
This dramatic price surge is particularly perplexing given the government’s recent pronouncements about successfully curbing inflation.
Reports indicate that inflation has dropped to a 9-year low of 1.5%, a commendable achievement that should, in theory, translate to lower prices across various sectors, including automobiles. However, the reality on the ground tells a different story.
This disconnect between economic indicators and market trends raises concerns about the effectiveness and equitable nature of government policies.
Are these policies truly benefiting the average citizen, or are they inadvertently creating a market that caters exclusively to the affluent? Moreover, is the government itself contributing to this artificial demand?
Consider the recent report from Business Recorder revealing a 73% surge in car sales in January 2025. While this may seem like a positive sign for the economy, it also raises questions about who is buying these cars at such inflated prices.
Is the government, through its own fleet purchases or preferential policies, creating a closed loop where it benefits from increased sales, manufacturers enjoy higher profits, but the average citizen is left behind, unable to afford the vehicles being produced and purchased?
The recent revelation that the Water and Power Development Authority (WAPDA) purchased 78 luxury vehicles worth 740 million rupees, despite a federal austerity policy, further fuels these concerns.
It creates the impression of a government that prioritizes the comfort of its officials over the needs of its citizens, who are struggling to afford necessities, let alone a car.
The government’s recent decision to halt the procurement of 1,010 cars for tax officers, while a welcome move, also highlights a certain inconsistency in policymaking. It begs the question: why was such a purchase even considered in the first place, especially given the economic climate and the burden on ordinary citizens?
This incident underscores the need for greater transparency, accountability, and consistency in government spending and policy decisions.
The automotive industry also has a role to play in addressing this crisis. Manufacturers and dealers must prioritize affordability and fair pricing, recognizing that a healthy car market benefits everyone, not just the wealthy.
A thriving car culture, where passion and practicality coexist, is essential for the growth of the automotive sector and the overall economy.
The time for action is now. The government must take concrete steps to address the concerns of car enthusiasts and everyday citizens who are feeling the pinch of rising car prices.
This includes reviewing import duties and taxes, implementing price controls to prevent profiteering, incentivizing local manufacturing, and ensuring greater transparency in government spending.
The dream of owning a car should not be a distant fantasy for the average Pakistani.
It’s time for the government and the automotive industry to work together to create a car market that is accessible, equitable, and reflective of the economic realities of the country. Only then can we truly say that the automotive sector is serving the needs of all Pakistanis, not just a privileged few.
