Consumer demand for both new and used vehicles remained strong, pushing auto financing to grow for the 15th consecutive month, according to data released by the State Bank of Pakistan.
Outstanding auto loans rose to Rs336 billion by the end of February, up from Rs328 billion in January, reflecting continued buyer interest despite fewer working days during the month.
The increase in auto financing comes as consumer spending picked up after December, largely driven by the introduction of new model-year vehicles, which typically boosts market activity.
Data from the Pakistan Bureau of Statistics further supports the positive trend. Car assemblers imported semi- and completely knocked-down (CKD) kits worth $1.3 billion during July–February FY26, marking a significant 126% increase compared to $575 million in the same period last year. This indicates strong sales expectations in the coming months.
However, uncertainty has emerged since late February due to rising geopolitical tensions in the Middle East, particularly involving Iran, the United States, and Israel. Industry players are concerned that the situation could disrupt supply chains for imported parts and accessories.
Auto assemblers have also warned of potential cost increases, as shipping companies may impose higher freight charges and war risk premiums, which could ultimately impact vehicle prices in Pakistan.
