Despite government ban on import of used motor vehicles of more than three years, inflow of the second-hand imported vehicles continues to flourish, hitting the local industry, as the domestic cars sales have not attained normalcy after suffering over 30pc decline in July-Dec 2012.“Cars older than five years are still being imported even after issuance of SRO 1441(I)/2012, as hundreds of 2007 model vehicles are constantly being imported without any check,” observed auto industry experts.

As per amendments in import policy during 2010 to 2012, the current situation is that age limit of three years is applicable on cars only. Others vehicles such as vans, pickups, 4x4, buses and trucks are still allowed up to five years old, they stated, urging the govt to restrict age limit for all types of vehicles to 3 years, as some cars are being imported on the excuse of van.

They said that presently, Alto Van of more than three-year old is being imported without any hesitation and government has no control in this regard.
They urged that the government to ensure true implementation of its recent policy to limit used cars by three years from five and give confidence to vendors through Auto Industry Development Plan (AIDP-II) to enhance their participation in economic and engineering activities of automobile industry.

Experts said local vendors had faced tough period after demand of their products declined due to influx of used imported cars. Though the industry is passing through a critical phase due to low production and sales volumes of local cars, local vendors, along with assemblers, are working together to launch three to four new models of cars through handsome investment, human capital and advancement in technology.

They recalled that used cars imports were opened every time when the local industry and their vendors had achieved good volumes. Industries badly need volumes of 500,000 units every year which would definitely encourage vendors and industry to invest more and achieve higher localisation of parts in vehicles.

They said that long-term policies would encourage the industry not only to invest to fulfill the demand of local market, but also to penetrate in foreign markets, like Middle East, Central Asia and Africa. He urged the government to formulate investment-friendly plans to lure foreign and local investment to further expand automobile and vending industry.

They were of the view that the abrupt change in government policies to relax import of used cars had devastated growth of overall automobile industry as severe repercussions were seen in terms of steep drop in sales and production of assemblers and vendors.

Industry experts maintained that the government must learn a lesson about its ill-planned moves that not only restricted growth of local automobile industry, but pushed them many years back in terms of production in tandem with low sales.