Auto Financing Hits Rs345bn as Sales Dip MoM Amid Geopolitical Tensions
Outstanding auto loans in Pakistan surged to Rs345.34 billion in March, marking the 16th consecutive monthly increase driven by lower interest rates, despite ongoing geopolitical tensions. However, vehicle sales totaled 15,531 units, representing a 40% year-on-year increase but a 9% month-on-month decline. This monthly drop was primarily attributed to reduced working days during Ramadan and Eid holidays, alongside a significant sales decrease for market leader Pak Suzuki and Hyundai Nishat. Conversely, imports of completely and semi-knocked down kits rose to $170 million, signaling a positive outlook for future sales. Cumulative sales for the first nine months of fiscal year 2026 reached 144,029 units, up 43% year-on-year. Analysts predict sustained momentum in 2026 supported by favorable financing conditions, while rising petroleum prices are accelerating consumer shifts toward electric vehicles. Nevertheless, near-term growth may face headwinds from inflationary pressures linked to the Iran-US conflict and supply chain disruptions. The industry expects a gradual normalization of sales volumes as economic conditions stabilize.
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Auto Financing Hits Rs345bn as Sales Dip MoM Amid Geopolitical Tensions
Outstanding auto loans in Pakistan surged to Rs345.34 billion in March, marking the 16th consecutive monthly increase driven by lower interest rates, despite ongoing geopolitical tensions. However, vehicle sales totaled 15,531 units, representing a 40% year-on-year increase but a 9% month-on-month decline. This monthly drop was primarily attributed to reduced working days during Ramadan and Eid holidays, alongside a significant sales decrease for market leader Pak Suzuki and Hyundai Nishat. Conversely, imports of completely and semi-knocked down kits rose to $170 million, signaling a positive outlook for future sales. Cumulative sales for the first nine months of fiscal year 2026 reached 144,029 units, up 43% year-on-year. Analysts predict sustained momentum in 2026 supported by favorable financing conditions, while rising petroleum prices are accelerating consumer shifts toward electric vehicles. Nevertheless, near-term growth may face headwinds from inflationary pressures linked to the Iran-US conflict and supply chain disruptions. The industry expects a gradual normalization of sales volumes as economic conditions stabilize.
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