Auto parts makers seek review of five-year auto policy

Auto parts manufacturers have asked the government to review the Auto Policy 2026-31, placing the predictability of the tax regime at the centre of their case rather than the size of the concessions on offer, according to the two outlets that reported the demand.

Profit reported that auto parts makers are seeking a review of the five-year policy, the framework that sets tariff and tax treatment for vehicle assembly and for the component industry that supplies it.

Dawn, reporting on the same policy, argued the question from the investment side, under the headline that Pakistan's auto policy needs predictable taxes, not just low ones. The point it makes is that a parts manufacturer deciding whether to tool up for a new model has to know how duties and taxes will be treated not only this year but across the life of that investment.

Both reports identify the policy's term, 2026 to 2031, as the period over which that certainty is being sought.

Neither report, as available to this newspaper, set out the specific changes the parts makers want, the forum in which the review was requested, or any response from the Ministry of Industries and Production, the Federal Board of Revenue or the Engineering Development Board, the bodies that shape automotive tariff and tax decisions. This newspaper could not independently confirm the details of the request.

Component manufacturing runs on long investment cycles. Presses, dies and mould lines are ordered against a model's expected production run, and the duty structure in force at the start of that run can be revised more than once before it ends. That is the ground on which both reports place the industry's argument: the value of a concession that may not survive the next budget is limited.

For readers outside the industry, the practical question is what a five-year policy does to car prices and to the share of a vehicle made locally. Neither report put a figure on either.

It is not yet established whether the review request has been formally taken up. No comment from the government on the demand appeared in the material available to this newspaper.