Two accurate headlines appeared from the same data release this week. One said Pakistan car sales rose 43 percent in the first quarter of FY27. The other said quarterly auto sales rose 19 percent. Both describe the Pakistan Automotive Manufacturers Association figures published on Tuesday evening, and the difference between them is entirely a question of what counts as a car.
Cars alone came to 41,872 units in July-September, up 43 percent. Jeeps and pickups came to 8,608, down 34 percent. Add them and you get 50,480 — up 19 percent. The arithmetic is exact, and the gap between the two headlines is one falling segment.
The quarter by segment
- Cars: 41,872 units, up 43 percent
- Jeeps and pickups: 8,608 units, down 34 percent
- Trucks: 2,516 units, up 53 percent
- Buses: 211 units, down 5 percent
- Farm tractors: 4,109 units, up 38 percent
- Two- and three-wheelers: 553,994 units, up 28 percent from 431,542
The segment nobody leads with is the largest by an order of magnitude. Pakistanis bought roughly eleven two- or three-wheelers for every four-wheeler in the quarter. A 28 percent rise on 553,994 units is a bigger event in the actual vehicle market than anything happening in the car showrooms.
September went the other way
The quarter was strong. Its final month was not. Car sales in September were 10,939 units, down almost 10 percent from 12,126 a year earlier. Across cars, jeeps and pickups together the figure was 15,104, down 12 percent year on year and 3 percent on August.
Two-wheelers did the opposite. September brought a record 202,502 units, up 27 percent year on year and 14 percent on the month, with Atlas Honda alone setting a monthly record of 167,100 and beating its own April high.
That explains a third set of headlines reporting September auto sales up 24 percent. A basket including two- and three-wheelers rises; a basket of four-wheelers falls. Neither number is wrong, and a reader who sees only one of them will take away the opposite impression from a reader who sees the other.
The September drop may be a timing effect
Sania Irfan of Topline Securities attributed the month’s weakness to delayed clarity on the sales tax treatment of hybrid and plug-in hybrid vehicles, which restricted companies’ ability to invoice.
If that is the cause, the units were not lost but deferred. An assembler that cannot issue an invoice does not lose the customer; it books the sale in a later month once the tax position is settled. That would make September artificially low and whichever month resolves it artificially high, and it argues against reading the decline as a demand signal.
The manufacturer split is consistent with a policy effect rather than a market one. Indus Motor was the only company to grow in September, at 4,142 units, up 31 percent year on year. Pak Suzuki fell 46 percent year on year and 36 percent on the month, to 4,862. A collapse that severe at one assembler while another grows a third points at product-specific tax exposure rather than at consumers leaving the market.
Related: Assemblers demand suspension of the EDB used car import relaxation
Quarterly winners and losers
Across the quarter, Honda Atlas posted the strongest growth at 7,401 units, up 52 percent. Indus Motor reached 13,260, up 34 percent. Pak Suzuki, still the volume leader, managed 22,615, up 14 percent.
Hyundai Nishat went backwards, at 2,336 units, down 35 percent. Sazgar reached 3,137, down 12 percent, having recorded no production or sales at all in August.
A month of zero output is not a demand story either. It points to a supply interruption — a plant shutdown, a parts constraint or a deliberate pause — and a quarterly decline of only 12 percent after losing a third of the period is arguably a better result than the headline suggests.
Tractors and trucks tell a different story
Two smaller segments moved more than cars did, and both are read as indicators rather than as consumer purchases. Farm tractors reached 4,109 units in the quarter, up 38 percent, with September alone up 130 percent year on year. Trucks came to 2,516, up 53 percent.
Tractors are bought when farmers have cash and expect to need capacity, which makes the segment a rough proxy for agricultural income and credit availability. Trucks are bought when there is freight to move. Both rising sharply points at real activity in the goods economy rather than at consumer sentiment.
Buses are the exception at 211 units, down 5 percent — a segment so small that the percentage carries little information. Eleven vehicles either way would have reversed the sign, which is worth remembering whenever a bus figure is quoted as a trend.
What the industry body is actually worried about
PAMA’s director general, Razi ur Rahman, credited the quarter to a resurgence in customer interest, with every category except light commercial vehicles, jeeps and pickups rebounding on easing inflation and an improving macroeconomic picture.
He then qualified it: “there is perceptible hesitation on the part of the players in the market,” with assemblers and buyers alike holding back on investment decisions. He also warned that rising imports of completely built-up vehicles, against a backdrop of Auto Policy uncertainty, could pressure the balance of payments and prompt State Bank action.
That second point is the association returning to the argument it has been making for weeks against the Engineering Development Board’s relaxation of used-vehicle import rules. It is a reasonable concern, and PAMA represents the assemblers who would benefit most from restricting those imports — which is worth holding alongside the warning rather than instead of it.
The honest summary of the quarter is that cars did well, pickups did badly, motorcycles did better than either, and September was distorted by a tax notification that had not arrived.
