The Suzuki Alto, one of Pakistan’s best-selling compact cars, saw a sharp decline in sales last month.
Data from the Pakistan Automotive Manufacturers Association (PAMA) shows sales dropped by 75%, falling from 9,497 units in June to just 2,327 in July.
The decline came after the government raised the General Sales Tax (GST) on cars up to 850cc from 12.5% to 18%.
A new NEV levy was also introduced, set at 1% for cars up to 1300cc, 2% for 1301cc to 1800cc, and 3% for larger vehicles. Although the Alto falls under the 850cc category, it was still affected by the tax changes.
In response, Pakistan Suzuki Motors Company (PSMC) increased the price of the Alto to Rs3,326,450, making it less affordable for budget-conscious buyers, especially first-time car owners who have traditionally driven its demand.
To soften the impact, PSMC had adopted an early invoicing strategy in June, processing orders for July and August ahead of time. While this boosted June’s sales, it also played a role in the steep decline that followed.