According to recent import data for April 2026, as cited in reports by Dawn and welcomed by the local industry, used car imports in Pakistan have collapsed to just 148 units.
To put that into perspective, during the 2024-25 fiscal year (FY25), Pakistan imported a total of 42,122 used vehicles, averaging roughly 3,500 units every single month.
While JDM fans and budget car buyers are feeling the squeeze, local auto parts manufacturers are welcoming the policy shift.
Let’s dive deep into what’s actually happening behind the scenes, why the tap was turned off, and what this means for you.
Why Have Used Car Imports Fallen So Sharply?
For years, commercial importers used a clever bypass system. Instead of importing cars directly, which is highly restricted and heavily taxed, they utilized schemes meant specifically for Overseas Pakistanis:
The Baggage Scheme (the largest channel, which was effectively tightened in early 2026)
The Gift Scheme
The Transfer of Residence (TR) Scheme
Under the guise of personal imports for overseas nationals, thousands of cars were cleared monthly, feeding a massive showroom ecosystem across Karachi, Lahore, and Islamabad.
However, the government recently tightened the screws to block the commercial exploitation of these schemes. By closing these policy loopholes, authorities have triggered a dramatic drop in arrivals: in April, only 120 cars entered via the baggage scheme, 19 under the gift scheme, and just 9 through the transfer of residence facility.
While this represents a major policy tightening, it is not a permanent, formal ban on all used cars. The government is currently exploring a more structured, formal policy for commercial used imports, though any future channel is expected to carry stiff regulatory duties.
Read More: No More ‘Personal Baggage’ Cars: Cabinet Okays New Import Rules – PakWheels Blog
How Do Tighter Import Rules Help Local Parts Makers?
The Pakistan Association of Automotive Parts & Accessories Manufacturers (PAAPAM) has openly welcomed the development. According to PAAPAM and recent findings from the Competition Commission of Pakistan (CCP), the uncontrolled influx of used cars has historically displaced domestic production, costing local parts makers an estimated Rs. 60 billion annually.
Here is why local parts manufacturers are welcoming the shift:
Zero Localization on Imports: A used Toyota Vitz or Daihatsu Mira coming from Japan doesn’t use a single nut, bolt, or seat cover made in Pakistan.
The Local Multiplier: On average, a locally assembled car utilizes about Rs. 1.5 million worth of locally manufactured parts.
Job Security: The CCP noted that unchecked imports displaced more than 40,000 potential jobs in FY25. Shifting demand back to local cars helps protect thousands of manufacturing jobs in the Large-Scale Manufacturing (LSM) sector.
PAAPAM argues that by curbing import loopholes, the government is finally giving local industries a chance to breathe, reinvest, and scale up production.
Market Impact Matrix: Who Wins and Who Loses?
| Stakeholder Group | Immediate Impact | Long-Term Outlook |
| JDM Buyers | Drastically reduced supply; rising prices on remaining stock. | Forced to choose between local options and premium local assembly. |
| Local Parts Vendors | Less displacement pressure; higher order volumes from local plants. | Potential for growth and job stability in the LSM sector. |
| Local Assemblers | More protected domestic demand. | Must scale up production capacity to prevent long delivery wait times. |
| Used Car Dealers | Scarcity of imported inventory; showroom business models threatened. | Forced to pivot to local used cars or formal domestic dealerships. |
| The Economy | Lower dollar outflow; protection of local manufacturing tax base. | Reduced import bill pressure, but lower customs duty collection. |
What Does This Mean For Pakistani Car Buyers?
For the middle-class consumer, used imports were a sanctuary of safety and modern features. For the price of a bare-minimum, locally assembled hatchback, a buyer could import a high-spec JDM car equipped with:
- Multiple airbags (compared to the standard two or sometimes none in older local budget cars)
- Electronic Stability Control (ESC) and anti-lock brakes (ABS)
- Superior build quality and hybrid fuel efficiency in selected models (often exceeding 20-25 km/l in city driving)
With imports down to a trickle, buyers are now forced back into the local market. This gives domestic assemblers a captive audience, raising a critical question: Without the pressure of imported competition, will local assemblers step up their game, or will prices rise while features remain frozen?
What Should Buyers Do Now? (Buyer’s Guide)
If you are currently looking for a vehicle in this changing landscape, here is how you should navigate the market:
If you want a JDM car now
Expect tighter overall showroom stock and firmer prices. Sellers holding clean, imported units are holding onto their margins because they cannot easily replace their inventory.
If you can wait
Monitor upcoming policy announcements. The government is negotiating a formal commercial used-car import framework. It will likely be more expensive, but it might offer a more regulated and reliable supply.
If you are buying a used import
Be incredibly vigilant. With fewer fresh imports, older imported stock is circulating more. Always verify the auction sheet, check hybrid battery health, inspect the structural chassis, and check parts availability before signing the check.
If you are considering a local car
Compare safety packages, fuel economy, local warranties, and resale values across manufacturers. Some local players have begun offering better safety features in response to historical JDM competition. Make sure you shop around to find them.
Our Verdict: Will Local Cars Ever Match JDM Standards?
There are two sides to this coin. On one hand, Pakistan desperately needs to build its domestic industrial base, conserve foreign exchange reserves, and support local employment. If we keep importing everything, our local engineering sector will never mature.
On the other hand, Pakistani consumers deserve modern safety standards and competitive pricing. Protectionism works best when it forces local players to innovate, not just when it shields them from competition. If local manufacturers want consumers to happily buy local, they need to offer the same level of safety, hybrid tech, and build quality as JDMs.
Stay tuned to PakWheels for more insights of the automotive industry.
Comments are closed.