Industry auto sales rose to 19.8k units in Jul'26

IMS Research has published a report on Pakistan auto sales during July. Industry auto sales rose to 19.8k units in Jul’26, up 79% YoY but down 13% MoM. The sequential decline is primarily attributable to delayed deliveries of hybrid units as companies await greater clarity on the timing of the new auto policy announcement, in our view. Segment-wise, passenger car sales surged 2.4x YoY to 17k units, partly offset by a 33% YoY increase in LCV and pickup volumes to 2.6k units. Meanwhile, truck sales increased 2.7x YoY, while tractor sales normalized to just 4% YoY.

INDU: Indus Motors reported sales of 5,089 units in Jul’26, up 53% YoY and 45% MoM. INDU, an ICE-heavy auto player, benefitted from higher GST on hybrid vehicles, in our view. Its Corolla, Yaris, and Cross portfolio surged 77% YoY to 4,283 units, while the Fortuner and Hilux Revo segment declined 12% YoY to 806 units. Consequently, INDU’s market share recovered sharply by 10ppt MoM to 26% in Jul’26.

HCAR: Honda posted sales of 2,640 units in Jul’26, up 76% YoY but down 11% MoM. Sedan (ICE segment) volumes increased 2.2x YoY, while SUV (primarily hybrid segment) sales plummeted 69% YoY and 71% MoM to 111 units, reflecting delayed deliveries amid a GST hike on hybrids. HCAR’s market share remained unchanged MoM at 13%.

SAZEW: Sazgar recorded sales of 663 units, down 39% YoY and 76% MoM, the lowest monthly sales since Apr’25. SAZEW recorded the sharpest sequential decline due to the highest contribution of hybrids in its portfolio among our coverage universe. Its market share declined by 9ppt MoM to 3%, lowest since Jul’23.

Tractor: Tractor sales were recorded at 1,242 units in Jul’26, largely flat YoY but down 59% MoM, primarily due to normalization of tractor deliveries under the Punjab Tractor Scheme, resulting in industry sales gradually normalizing toward underlying demand levels. MTL maintained its market leadership, capturing a 67% share of industry volumes during the month.

Trucks: The truck segment recorded a 2.7x YoY jump in sales to 854 units in Jun’26. Sequentially, however, the sales normalized, decreasing by 6%. GHNI sales dropped 43% MoM to 424 units, while GAL volumes improved 18% MoM to 468 units in Jul’26.

Volumes remained tilted towards ICE vehicles, while hybrid sales took a hit as companies delayed deliveries amid the imposition of 25% GST on hybrids and uncertainty surrounding the delayed announcement of the new Auto Policy. Overall, the auto sector remains under pressure, with customs duties on CBU imports reduced by 20–50%, depending on engine size, while the duty structure for CKD kits remains unchanged, potentially intensifying competitive pressures. Greater clarity is expected following the announcement of the new Auto Policy, which will be pivotal in shaping the sector’s competitive landscape and medium-term growth outlook.