January 30, 2026 – Lahore, Pakistan – Pak Suzuki Motor Company Limited (PSMC) has urged the government to revise Pakistan’s automotive policy with a greater emphasis on promoting local auto parts production. The appeal came during the SME Cluster Expo in Lahore, where industry leaders highlighted the need to build a more resilient and self-sufficient supply chain for the automotive sector.
Emphasis on Localisation Incentives
At the expo, Pak Suzuki CEO Hiroshi Kawamura appealed to policymakers to include strong localisation incentives in the upcoming auto policy. He emphasised that such measures would enable Pakistani parts manufacturers to meet international standards, expanding their capabilities and helping reduce dependency on imported components.
Kawamura noted that strengthening the domestic vendor base would not only boost production efficiency but also create opportunities for Pakistan’s automotive industry to become more autonomous and competitive.
Collaboration with Local Vendors
During the event, Pak Suzuki also showcased its ongoing endeavours to incorporate local suppliers into its tier-1 and tier-2 supply networks. The company acknowledged the assistance of the Small and Medium Enterprise Development Authority (SMEDA) for facilitating stronger cooperation between large manufacturers and small businesses.
Such alliances are seen as crucial for enhancing the capabilities of local vendors, enabling them to produce components that align with global benchmarks and contribute to the national economy.
Lessons from Global Disruptions
The push for localisation has gained momentum following the supply chain disruptions caused by the COVID-19 pandemic. The crisis exposed Pakistan’s reliance on imported CKD (Completely Knocked Down) kits and resulted in production delays, cost increases, and logistical challenges across the auto sector.
Localised production, industry experts argue, would help shield the sector from such external shocks in the future and build long-term supply resilience.
Economic Importance of SMEs
SMEDA Director Mashood Khan emphasised the significance of small and medium enterprises (SMEs) in Pakistan’s economy. He noted that SMEs provide employment to millions of people and contribute significantly to export revenues. Khan echoed Suzuki’s plea for policy support, stating that boosting local parts manufacturing would have a positive economic effect and generate new job opportunities.
Gaps in the Current Auto Policy
While Pakistan’s existing auto policy has largely focused on attracting new industry participants with incentives and tax breaks, Pak Suzuki and other established manufacturers argue that localisation incentives are insufficient.
- Industry leaders contend that the policy should prioritise:
- A dedicated auto parts manufacturing framework
- Tighter regulations on used car imports
- Defined localisation targets for both current and new OEMs
- Less dependency on imported CKD kits and semi-finished parts
Why This Push Matters?
Strengthening local parts production could lead to reduced production costs, increased employment within the automotive sector, and greater economic self-reliance. It would also help Pakistan develop a competitive automotive ecosystem, capable of contributing to both domestic needs and export markets.
For car buyers in Pakistan, such reforms could mean better availability of parts, shorter maintenance times, and potentially more competitive pricing for locally assembled vehicles.
Sigma Motors supports initiatives that enhance the automotive supply chain and local industry growth. Contact us for more updates and expert insights on Pakistan’s evolving auto market.