Honda Atlas Cars (Pakistan) Ltd has entered the international market by exporting its first batch of vehicles to Japan. The company shipped 38 units of its 1.2L Honda City to the Japanese market, a major milestone for Pakistan’s auto industry. However, this development comes amid internal concerns. While celebrating the achievement, Honda Atlas highlighted challenges that continue to limit large-scale exports. These include “high input costs” and the “absence of supportive government policies.” During a recent analyst briefing, Honda Atlas pointed out that Pakistan’s auto export environment remains less competitive compared to Thailand and Indonesia, both of which offer favorable conditions for manufacturers. Discussions with authorities are ongoing, but the company believes these structural issues restrict its ability to scale exports globally. Strong Financial Performance in FY25 Despite these hurdles, Honda Atlas showed a robust financial performance for fiscal year MY25, as reported by AKD Securities. The company’s topline grew by 42% year-on-year, reaching Rs78 billion, up from Rs55 billion in MY24. This growth was driven by a 53% increase in unit sales, totaling 16,100 units, compared to 10,534 units in the previous year. The company’s gross margins improved slightly to 8.5% in MY25 from 8.2% in MY24, supported by currency stability. Net profits rose to Rs2.7 billion (EPS: Rs19.0), reflecting a 16.6% increase over Rs2.3 billion (EPS: Rs16.3) in MY24. Honda City continues to dominate the company’s sales mix, with 1.2L variants accounting for 75% and 1.5L making up 25%. Overall, Pakistan’s passenger car market expanded by 67%, with total volumes rising to 125,533 units, up from 75,227 units in MY24. This growth reflects better macroeconomic stability, according to the company. Looking ahead, Honda Atlas forecasts a 40–50% rise in sales volumes for MY26. HR-V Hybrid Pre-Launch and Localization Efforts The company has also pre-launched a hybrid version of the HR-V, currently offering test drives at dealerships. Honda expects to sell 400–500 units per month, noting that it will absorb the NEV levy tax to keep pricing competitive. Localization levels for different models stand at: 74% for City 64% for Civic 52% for BR-V 61% for HR-V Despite gains, management anticipates margin pressures due to currency devaluation and exclusion of hybrids from the new NEV policy, which offers incentives only to electric vehicles (EVs) and plug-in hybrid electric vehicles (P-HEVs). Regarding recent tariff adjustments, Honda Atlas said they would have limited effect on its business, since 90% of its imports fall under the 1000cc category, which remains mostly unaffected.