BYD Opposes Import of 5-Year-Old Used Vehicles in Pakistan

KARACHI: Chinese automobile importer BYD, a growing player in Pakistan’s new energy vehicle (NEV) sector, has expressed strong opposition to the government’s proposal allowing the import of five-year-old used cars.

The company warns that this move could harm local manufacturing efforts and worsen environmental conditions. It also said it would increase Pakistan’s foreign exchange burden due to higher petroleum imports.

At the launch of BYD’s new ‘experience center’ in Karachi on Thursday, Danish Khaliq, BYD’s Vice President for Strategy and Sales, spoke about used vehicles. He said five-year-old used cars would enter Pakistan’s market at highly depreciated prices. These prices could be up to 60% less than the original value. This pricing results from a policy that depreciates used cars by 1% monthly from their actual cost.

Khaliq highlighted that such steeply discounted imports could destabilize the price-sensitive local market. This would threaten the rapidly expanding NEV sector. It would also reduce sales of older Japanese oil-powered vehicles, which currently dominate the market.

Khaliq proposed that any reduction in import duties for completely built units (CBUs) in the 2025-26 budget should be limited to NEVs only. He emphasized that treating internal combustion engine (ICE) vehicles the same as NEVs in duty cuts would cause poor consumer choices. This would also harm the move toward greener technology.

Furthermore, he suggested that duty cuts in the auto sector should be reserved for original equipment manufacturers (OEMs) that are committed to investing in Pakistan. This approach would align with the country’s goals of industrial growth and sustainable transportation development in a growing economy.

Environmental and Employment Concerns

Importing up to five-year-old oil-powered cars, according to BYD, could contribute significantly to environmental degradation. This runs counter to Pakistan’s commitments to the United Nations’ Sustainable Development Goals (SDGs). Additionally, the influx of used vehicles may hamper job creation within the local auto industry.

Currently, Pakistan allows imports of used cars up to three years old, a policy that BYD implies should not be expanded further.

BYD recently introduced two electric vehicle models to the Pakistani market, marking its growing presence. Its local partner, Mega Motor, is establishing a manufacturing plant for NEVs in Gharo, Sindh. Scheduled to become operational next year, this facility will have an annual capacity of 25,000 vehicles.