Why Used Car Prices Are So High In Pakistan?

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Pakistan is a country which is not much widespread in the terms of vehicle manufacturing companies, now what do you have in mind when you hear about the car companies present in the country?

You might think of many names like Honda, Chevrolet, Toyota, Suzuki, Mitsubishi, Nissan, BMW etc. But not all of these manufacture cars in the country, many are just imported.

At this time the major manufacturers in the Automotive industry are:

  • -Toyota
  • -Honda
  • -Suzuki

We had Nissan and Kia/Hyundai along with Proton but unfortunately they pack their bags and left. FAW is still in its infancy. The new car prices in Pakistan are almost equal to those sold worldwide, but when you decide to buy a used car in Pakistan, you realize that the used car prices are quite higher than those in other countries, why is that?

Well, in countries like Saudi Arabia or other gulf countries, the used cars are quiet cheaper than Pakistan, and there is an abundance of car companies for example, Hyundai, Honda, KIA, Toyota, Renault, Jeep, GMC, Chevrolet, and the list goes on.

So when you want to buy a used car there, the options that you might have are in numbers, but in Pakistan, we are limited to the cars, their types, and companies, we don’t have many options in our budget, the most that we would compare would be 3 cars at once.

Related: What The Cars That Pakistan Once Had Evolved Into

Hence! The demand of the cars would increase, and when the demand of a car increases and buyer is limited to the options, that is when monopoly takes birth. We have less choice of car makers, but the demand is high.

When a car is in high demand by the customers the price is increased by dealers/companies/individuals automatically. Everyone wants to sell it more than it is valued, and this is why cars do not depreciate or depreciate very slowly in Pakistan and instead if its resale is good, you have a chance of selling it at a higher price than on what you actually bought it on. It is not common to hear stories of folks who bought a certain car for 8 lacs rupees but sold it for more than that after couple of years of use. The appreciation and depreciation of foreign and national currency plays great part in deciding the tone of the market as well.

In simple words, this is the reason why we can see cars of the older models for sale at really high demands. And in the mean time, if you are looking for a used car, you can click here.

  • DJ

    kio kay yah pakistan main chalti nai bhair say chal kay ati hia 😉 so used their = new local

  • twister286

    Meaningless drivel…

    One reason why used car prices in Pakistan are high, is because there’s long lead times on brand new units. Hence people cans sell near-new cars for a premium. Moreover, there’s substantial hidden costs on brand new cars (Registration, WHT) which add a sizeable extra to the car’s ex-factory price.

    Plus the fact that replacement value of cars increases…if you buy a new car in Pakistan now, chances are its successor model will have a higher price. That tends to prop up used car prices as well.

  • Atif

    What’s keeping used cars high are simple reasons below:-

    1. Common sense – cheaper to maintain due to cheap labor.

    2. There is no competition or choices for car buyers here. Just three big assemblers in only one in small car market (PakSuzuki) which controls over 60% of the market. When existing assemblers artificially create shortages by demanding OWN/PREMIUM and taking several months to produce deliver one vehicle unit. There is a supply shortage created artificially .

    3. Globally retired models are offered for decades and decades in Pakistan e.g. Mehran, Bolan, Ravi, Cultus, and Swift entering the league soon. If only the same cars keep on getting sold again and again and again with nothing else for consumers to buy from the Demand for these models increased due to limited options.

    4. If models were replaced in Pakistan in line with other markets newer and newer vehicles would be available and demand will be focused more on new cars. Buyers would have more incentives to purchase new instead of used cars.

    4. unlike other countries where people are encouraged to buy new cars and discard old ones for safety and environmental reasons, in Pakistan taxes get lower and lower as cars get old. In other countries with sensible policy makers lower taxes are implemented on green eco friendly and hybrid cars and those with less emissions.

    5. Common sense – cheaper to maintain due to cheap labor.

  • Guest

    Some people have come up with valid comments, still more: the level of transnational crime is unseen in other countries. Even people who can afford to buy new car will will go for used car because as soon as you buy a new car no matter how small or cheap it is, you will come on the radar of certain people.
    Car snatching is a small issue compared to what is in store for you. Once you buy a new car, you have automatically increased your chances of dacoiti at your house where they would take away everything, even all pieces of furniture and clothing including your old underwear with 10 holes. Kidnapping for ransom is another fear.
    A new car wants insurance.
    And no matter how much you earn, new car will increase in price. Generally, from 2007 to 2013 new car prices doubled.
    All these factors mean either people prefer old car over new car even if they can afford it, so it increases demand of old cars, means price goes up. For people who are saving for new car, even after many years, they keep buying old car after old car because new car prices climb at an extraordinary pace. Therefore, sustained increased demand of old vehicles.
    Older vehicles have less tax, and bribe demand from policeman is also less when caught driving an old car.

  • Bilal Jawad

    NEW YEARS IN HUNZA

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    Last date for registration
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    Dates: 24th December 2015 to 2nd
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    Tour Cost Karachi to Karachi: Rs. 30,000/-

    Tour Cost Lahore to Lahore: Rs. 26,000/-

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