Auto experts argue that electric vehicles (EVs) could become much more accessible if the government addressed critical policy issues. They advocate for revising policy classifications, extending incentives to all EVs, eliminating barriers to EV financing, and reducing heavy taxes that currently make these vehicles prohibitively expensive.
Experts urge the government to standardize policy classifications and apply incentives uniformly across all EVs. They emphasize the need to remove obstacles in auto financing for EVs and to make the EV charging business attractive to investors. Additionally, they criticize the high taxation on cars, which makes them inaccessible to consumers, while used cars that often fail roadworthiness tests in Japan are allowed to be imported under baggage schemes without warranties or accountability for product failures. Presently, eight car companies in Pakistan operate at only 22% of their production capacity. Allowing imports could undermine the successful auto policy of 2016-21, which generated employment for over 2.5 million families, they warn.
Seres Pakistan Managing Director Muhammad Adeel Usman highlighted the high fuel prices in Pakistan, prompting customers to seek fuel-efficient vehicles like hybrids and EVs. He noted that EVs offer a better driving experience compared to hybrids, costing Rs8.5 per kilometer with current electricity tariffs, compared to Rs19 per kilometer for hybrids and Rs26 per kilometer for combustion engines. EVs also have lower maintenance costs, as they do not require engine oil, oil filters, or air filters, making them more economical.
Usman pointed out that range anxiety and a weak charging infrastructure hinder EV adoption in the country. However, Chinese carmakers are launching vehicles with ranges up to 800 km, which will soon alleviate range anxiety. He called for government attention to policy and incentives for developing charging infrastructure, suggesting that a significant influx of EVs would attract private investment in this area.
“Yes, we plan to start local assembly soon and are further planning on localization of parts to lower the price of the car so it can benefit the customer and the country. We have further planned to launch electric hatchbacks, SUVs, and sedans in the near future,” Usman added.
Master Changan Motors Limited Director of Sales & Marketing Syed Shabbir Uddin criticized the auto policy’s classification of EVs by battery capacity, which currently only incentivizes those with capacities below 50kWh. He argued that this is akin to classifying petrol cars by fuel tank capacity rather than engine size or vehicle type. The EV charger business is also currently unfeasible due to the low number of EVs on the road and regulated selling prices, resulting in low gross margins and challenging investment in charging infrastructure.
Uddin also highlighted a misconception among policymakers that petrol cars with small lithium batteries deserve the same incentives as full EVs. He stressed that EVs are foreign exchange-friendly, with Pakistan generating over 41% of its electricity from non-fossil-fuel sources like hydro, nuclear, or wind. Most EVs would also be charged at home using solar energy, saving a significant amount of foreign exchange compared to petrol-driven vehicles.
He mentioned that their brand, which falls into the $40,000 price category in other markets, is being rigorously tested in Pakistan for launch. The brand is a joint venture of three EV giants: CATL, the world’s largest and most advanced EV battery company; Huawei, which has developed a special operating system for car driving mechanisms; and Changan, which has integrated these technologies with a futuristic car design.
Lahore-based Auto Sector Analyst Usman Suhail noted that the scope of EVs in the country is gradually expanding, driven by government initiatives, environmental concerns, market potential, local manufacturing, and cost savings. However, challenges hindering EV growth include poor road infrastructure, electricity shortfall, a depreciating rupee, limited charging infrastructure, and a lack of consumer awareness and trust.
