Hybrid Vehicle Sales Hit Hard as New Auto Policy Delays Persist

Sales of hybrid and plug-in hybrid vehicles in Pakistan are facing a significant downturn, with activity nearly grinding to a halt. This decline comes after the sales tax on these vehicles skyrocketed from 8.5% to a whopping 25%. The trigger for this steep increase is linked to the expiration of the Auto Industry Development and Export Policy 2021-26 on June 30.

As it stands, the new framework, which is supposed to outline the Auto Policy for 2026-31, has not yet been introduced, leaving consumers and manufacturers in limbo. The uncertainty surrounding the new policy is causing many potential buyers to hesitate, fearing further financial implications.

The significant tax hike has made hybrid vehicles much less appealing in a market already grappling with economic challenges. Without incentives or a clear direction from the government, the future of hybrid and plug-in hybrid sales remains uncertain as we await further developments on the new auto policy.