Pak Suzuki Warns of "Catastrophic" Impact of Used Car Import Liberalization

Pak Suzuki Motor Company Limited (PSMCL) has expressed strong reservations against the government's proposed tariff reforms and liberalization of used car imports, labeling the policy direction 'unsustainable' for Pakistan's domestic auto industry. At a press briefing in Lahore, Managing Director Hiroshi Kawamura and senior officials detailed the potential consequences of such a policy, including the collapse of the local ecosystem, widespread job losses, and a potential flood of imports from neighboring countries. Suzuki's concerns were echoed by officials who highlighted the company's extensive investments in the local economy, including the development of over 100 local vendors and the procurement of PKR 50 billion worth of local parts annually.

Key Takeaways:

• Suzuki warns that liberalization of used car imports could capture 100% of the market, rendering local manufacturing unsustainable.
• The company's Managing Director Hiroshi Kawamura confirmed that Pakistan's annual vehicle output of 300,000 units is still far below the 500,000 threshold needed for economies of scale.
• Suzuki emphasizes its investments in local vendors and parts procurement, with over 100 vendors developed and PKR 50 billion worth of local parts procured annually.
• The tax burden on Suzuki vehicles currently accounts for 40% of the retail price, leaving little room for price reduction or added features.
• Suzuki plans to relaunch the Suzuki Ravi and introduce a trial SUV model to diversify offerings while maintaining affordability.
• The company is developing a hybrid vehicle and has confirmed the phasing out of Cultus and Wagon R models to be replaced by new offerings.

Statistics:

• 25% of the market is currently captured by imported used cars.
• Local plants are running at 40% capacity.
• Over 2.5 million Suzuki vehicles have been sold in Pakistan to date.
• Pakistan's annual vehicle production is 300,000 units, far below the 500,000 threshold needed for economies of scale.
• Suzuki procures over PKR 50 billion worth of local parts annually.
• The tax burden on Suzuki vehicles accounts for 40% of the retail price.

Sources:

• Pak Suzuki Motor Company Limited (PSMCL)
• National Tariff Policy 2025-30
• Press briefing in Lahore, July 15, 2025 (no specific date provided in the original text).