Breaking News: New Auto Policy 2026-31 Approved for Cheaper Cars and EVs
Good news for car buyers in Pakistan. The federal government has reportedly approved the new auto policy 2026-31, and its biggest promise is simple: cheaper cars, more electric vehicles and a fairer deal for buyers at the time of booking.
The policy was announced at a press conference in Islamabad by Information Minister Attaullah Tarar and the Prime Minister’s Adviser on Industries and Production Haroon Akhtar Khan. It ends months of meetings and revisions with the auto industry over where the sector should go next.
New Auto Policy 2026-31: Six Main Pillars
According to Haroon Akhtar Khan, the final policy stands on six key priorities. The government also said Prime Minister Shehbaz Sharif stayed closely involved while the policy was being drafted.
- Cheaper vehicles – mainly for middle and lower-middle-income families
- More exports – pushing local carmakers to sell abroad
- Greater localisation – more parts made inside Pakistan
- Better vehicle safety – stronger testing and standards
- Electric vehicles – continued support for EV adoption
- Transparency – fair booking and delivery practices for buyers
Will Car Prices Come Down in Pakistan?
Making vehicles affordable is the clearest goal of the new framework. Earlier drafts of the policy talked about cutting auto tariffs step by step, opening the market to more competition and linking incentives with local manufacturing and exports.
However, the government has not yet released the full tariff and tax schedule. This means nobody can say right now how much the price of a petrol, hybrid, plug-in hybrid or electric car will actually drop. Buyers should wait for the official notifications before making a big decision.
Electric Vehicles Remain a Key Priority
The government has confirmed that EVs are still one of the main pillars. Pakistan already has a separate National Electric Vehicle Policy 2025-30, which aims for electric vehicles to make up 30% of new vehicle sales by 2030.
Previous drafts also suggested lower tariffs and easier financing for New Energy Vehicles (NEVs). These benefits will only be final once the complete policy and its notifications are published. Meanwhile, if you want an electric two-wheeler, you can check the PM electric bike scheme and the eligibility criteria.
20% Cap on Car Booking Amount
Under the transparency pillar, the government says automakers and assemblers should not charge more than 20% of the total vehicle price as the booking amount. The aim is to stop heavy advance payments and protect buyers.
| Vehicle Price | Maximum Booking Amount (20%) |
|---|---|
| Rs. 3,000,000 | Rs. 600,000 |
| Rs. 5,000,000 | Rs. 1,000,000 |
| Rs. 8,000,000 | Rs. 1,600,000 |
Note: The table is an example calculation. Detailed rules on how the cap will be enforced have not been shared yet.
Localisation, Exports and Vehicle Safety
Local manufacturing and exports are also central to the policy. Earlier versions proposed export targets for carmakers, more local value addition and incentives linked to export performance.
On safety, previous proposals included stronger vehicle testing, certification, third-party audits and wider use of international safety standards for both locally made and imported vehicles.
Quick Facts
| Detail | Information |
|---|---|
| Policy | Auto Policy 2026-31 |
| Announced by | Attaullah Tarar and Haroon Akhtar Khan |
| Venue | Press conference, Islamabad |
| Main pillars | 6 |
| Booking amount cap | Max 20% of vehicle price |
| EV target (NEV Policy 2025-30) | 30% of new sales by 2030 |
| Tariff and tax schedule | Not published yet |
What It Means for Buyers
If you are planning to buy a car, it is wise to wait for the final tariff notifications, as prices may change. When booking, make sure you are not asked to pay more than 20% of the price in advance.
For a cheaper and cleaner ride, compare the latest electric bike price in Pakistan, try the PAVE subsidy calculator and see how to apply online.
Source: PakWheels
Also Read: PM Approves New Auto Policy With Big EV Push | New EV Policy Faces Big Pressure | Thatta Cement to Launch Affordable Electric Cars | Chery Q EV Reaches Karachi | Ghandhara to Assemble Zhongtong Buses
Frequently Asked Questions
Has Pakistan approved the new auto policy 2026-31?
Yes. According to reports, the federal government approved the new auto policy and announced it at a press conference in Islamabad.
What are the six pillars of the new auto policy?
The six pillars are cheaper vehicles, higher automobile exports, more localisation, better vehicle safety, promotion of electric vehicles and more transparency in the auto sector.
Will car prices go down under the new auto policy?
Cheaper cars are a main goal, but the final tariff and tax schedule has not been released yet. Exact price cuts will only be clear after official notifications.
What is the maximum booking amount for a new car?
Under the transparency pillar, automakers should not charge more than 20% of the total vehicle price as the booking amount.
Does the new auto policy support electric vehicles?
Yes. EV promotion is one of the six pillars. Pakistan also has the National EV Policy 2025-30, which targets a 30% EV share in new vehicle sales by 2030.
