Pakistan’s automotive industry has been on an impressive upward trajectory during the first nine months of FY25, with car sales hitting 100,868 units—a remarkable 46% increase compared to the previous year according to a report by brokerage firm Topline Securities.
This surge in demand reflects an improving economic environment, where consumers are benefiting from stable inflation, lower interest rates, and a generally more optimistic outlook. The easing of financing conditions has also played a key role, enabling more people to afford new cars.
This growth is a positive turnaround for the industry, which has faced some tough years in the past. As inflation slows and interest rates fall, both car buyers and manufacturers are seeing more favorable conditions. New car models and updated versions have also added to the excitement, attracting customers looking for modern features, especially in the higher-end market. These new offerings have played a significant role in the increased demand for both locally produced and imported vehicles.
In March 2025, a total of 11,098 cars were sold, showing an 18% increase from the same month last year. However, sales dipped by 8% compared to February 2025. This decline is largely due to February’s high sales, which typically see a boost as the new year begins. The drop in March is also linked to the beginning of Ramazan, which traditionally sees a slowdown in consumer activity due to shorter working hours and the focus on religious observance.
Among the major players, Pak Suzuki Motor Company (PSMC) posted a steady 11% growth in March 2025, despite a 15% dip compared to February. Popular models like the Alto, Ravi, Swift, and Every continue to drive demand. PSMC’s total sales for the first nine months of FY25 reached 49,946 units, marking a 41% YoY increase. Indus Motor Company (INDU), on the other hand, saw explosive growth with a 84% YoY increase and a 20% boost from February, largely due to strong sales of the Corolla and Yaris. INDU’s 9MFY25 sales surged to 21,618 units, an impressive 58% YoY rise. However, Honda Atlas Cars (HCAR) experienced a setback, with a 35% drop YoY and a 30% decline MoM. Despite this, HCAR still managed to report a 29% YoY increase for the 9MFY25 period, with total sales reaching 12,776 units. Sazgar Engineering (SAZEW) stood out with impressive results, recording an 87% YoY growth in March and a massive 153% increase for the nine-month period, with 8,027 units sold.
The motorcycle and three-wheeler market, which remains vital for many consumers due to its affordability, saw a significant 34% increase in sales YoY, totaling 125,311 units in March 2025. However, sales did decline slightly by 3% from the previous month. Demand in this segment continues to be driven by the need for fuel-efficient and cost-effective transportation, with major manufacturers like Atlas Honda (ATLH) and PSMC seeing strong sales.
On the flip side, the tractor market is facing challenges. Sales plummeted by 67% YoY in March, with just 1,538 units sold, reflecting a slowdown in agricultural activity. Meanwhile, the truck and bus sector enjoyed solid growth, with sales rising by 47% YoY to 460 units in March, marking an 80% increase for 9MFY25. Companies like Isuzu and Master are benefitting from this trend, highlighting a positive shift in the commercial vehicle market.
Looking ahead, the future of Pakistan’s automotive sector remains bright. Analysts expect sales to continue growing throughout FY25, supported by further interest rate cuts, a stable rupee, and the normalization of post-Ramazan deliveries. The introduction of new models and variants is likely to sustain demand, ensuring that the automotive industry remains on a solid recovery path. As the economy stabilizes, both consumers and businesses in the sector are well-positioned for continued growth.
