Policy Rate Cuts Drive 48pc Surge in Car Sales
KARACHI: Pakistan’s auto financing continued its recovery streak, rising to Rs318 billion in November from Rs315.4bn in October, marking the 12th straight month of growth, according to State Bank of Pakistan (SBP) data.
Experts note the rebound remains modest compared to June 2022, when car sales hit 240,000 units and auto loans peaked at Rs368bn. The recent uptick is largely driven by steep cuts in the policy rate, slashed from 22pc in June 2024 to 11pc in May, with another 50bps reduction on Dec 15 expected to further boost demand.
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However, challenges persist, particularly the Rs3m cap on auto loans, which limits financing options. Auto sector expert Mashood Ali Khan urged the SBP to raise the limit to Rs6m to align with current market prices.
Topline Securities CEO Mohammed Sohail added that economic stability, new models, and further rate cuts will support car sales and credit growth. Auto sales surged 48pc to 75,042 units in 5MFY26, compared to 50,856 units in the same period last year, aided by new entrants and improving macroeconomic sentiment.
