The Pakistan Automotive Manufacturers Association (PAMA) has urgently appealed to Prime Minister Shehbaz Sharif for intervention to protect the country's automotive industry, warning that recent tariff anomalies jeopardize over $5 billion in investments and the livelihoods of nearly 2.5 million families.
Industry Faces Unprecedented Crisis
In a letter to the prime minister, PAMA Director General Abdul Waheed described a deeply alarming and rapidly deteriorating crisis facing the automotive sector, posing a serious threat to industrial stability, employment, investment, and the wider national economy. The sector comprises 16 assemblers producing over 100 vehicle models under 31 international brands. Despite operating in a highly compressed and challenging market environment, the industry has sustained average annual production of approximately 250,000 units, the letter stated.
Massive Investments at Risk
The letter noted that under successive automotive policies, cumulative investments have surpassed $5 billion, while the industry and its extensive supply chain provide livelihood opportunities to nearly 2.5 million Pakistani families. Following parliamentary approval of the Finance Act 2026, the industry is confronted with an unprecedented crisis.
Tariff Structure Anomalies
The revised tariff structure has resulted in completely built-up (CBU) imported vehicles and commercially imported parts being placed at duty rates lower than industrial CKD kit imports. The reduction of CBU duty on vehicles below 850cc has significantly eroded the viability of local manufacturing in this segment, threatening the survival of domestic production lines and the jobs dependent on them.
According to PAMA, these anomalies undermine the government's own policy objectives of promoting local assembly and manufacturing, which have been key to attracting foreign investment and building a robust supply chain ecosystem. The association has called for immediate corrective measures to restore parity and protect the industry from collapse.
Call for Urgent Action
PAMA urged the prime minister to intervene personally to resolve the tariff issues, warning that failure to act could lead to irreversible damage to the sector, including plant closures, mass layoffs, and loss of investor confidence. The association emphasized that the auto industry is a critical pillar of Pakistan's industrial base and its decline would have severe repercussions for the broader economy.
