Suzuki Alto, Pakistan most popular budget car, witnessed a sharp decline in sales last month after the government imposed fresh taxes and levies on small vehicles.Data released by the Pakistan Automotive Manufacturers Association (PAMA) shows that Alto sales dropped by nearly 75 percent, sliding from 9,497 units in June to just 2,327 in July.
The decline came as the government increased the General Sales Tax (GST) on cars up to 850cc from 12.5 percent to 18 percent. A new NEV Levy was also enforced that is 1 percent on vehicles up to 1300cc, 2 percent on 1301–1800cc and 3 percent above 1800cc. Since the Suzuki Alto falls under the 1300cc category, it was hit with both the GST hike and the 1 percent levy.
Thus, in response, Pakistan Suzuki Motor Company (PSMC) raised the price of the Alto to Rs. 3,326,450 making it harder for middle-income buyers to afford. Dealers noted that this discouraged many first-time buyers, a key segment for the Alto.
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Company officials admitted that their early invoicing policy also added to the July slump. To shield buyers from higher taxes, PSMC cleared July and August bookings in June. This temporarily boosted June sales but left fewer transactions for July.
Industry experts now believe the Suzuki Alto is facing a “double blow” of tax hikes and reduced affordability. Unless policies ease or incomes rise, the entry-level car market in Pakistan could remain under strain, limiting choices for cost-conscious customers.
