Honda Atlas launches HR-V hybrid in Pakistan, shrugs off used car import surge

Amid a surge in used car imports and shifting dynamics in Pakistan’s auto industry, Honda Atlas Cars Pakistan Ltd. (HCAR) has reaffirmed its strategy with the launch of its new HR-V e:HEV hybrid SUV, expressing confidence that the influx of sub-1000cc imports will have minimal impact on its market share.

The HR-V Hybrid was officially launched on July 14, with test drive units now available at dealerships nationwide. Honda reports strong initial customer interest and expects monthly sales of 400 to 500 units, reflecting growing demand for fuel-efficient vehicles.

“This launch is part of our long-term shift toward hybrid technology, where we believe we offer a superior product,” company executives said Wednesday during a corporate briefing on model year 2025 (MY25) performance.

Addressing concerns over the 45,000 used vehicles imported in the past year, Honda clarified that 90% of these fall in the below-1000cc category, a segment that does not directly compete with key models like the City or HR-V.

While no immediate threat is anticipated, the company said it is monitoring developments as the government prepares a new used car import policy expected by September. The policy may revise duty structures, enforce safety and emissions standards, and ease vehicle age limits in phases.

“The upcoming policy is critical, but we believe our positioning in the local segment remains strong due to brand loyalty, high localization, and robust after-sales service,” a senior official added.

Solid financials and market expansion

For the fiscal year ending March, Honda posted a 16% year-on-year increase in profit after tax (PAT), reaching PKR 2.71 billion (earnings per share: PKR 18.97). Fourth-quarter profits alone rose 23% YoY to PKR 1.68 billion. A final cash dividend of PKR 8.0 per share was announced, maintaining the company’s total payout for MY25.

Total revenues climbed 42% YoY to PKR 78.07 billion, supported by 16,100 units sold amid easing import constraints and a recovery in market sentiment. Gross margins improved to 8.5%, aided by cost controls and a stable rupee.

The Honda City remains the company’s best-selling model, with the 1.2L variant accounting for 75% of total City sales. The sales mix between City and Civic now stands at 55% and 45%, respectively, down from 60% and 40% a year earlier.

Localization levels are currently at 74% for the City, 64% for the Civic, 61% for the HR-V, and 52% for the BR-V. HCAR operates 62 dealerships across Pakistan.

In a noteworthy milestone, the company exported 38 locally assembled City 1.2L units to Japan, signaling progress in production quality. However, management noted that high input costs and weak export incentives continue to limit the scale of overseas shipments.

Outlook and industry competition

While acknowledging rising competition from Chinese and Korean entrants under the Greenfield incentive scheme — set to expire in June — HCAR remains optimistic. The company expects a level playing field post-expiry.

Looking ahead, Honda forecasts a 40% to 50% increase in sales for MY26, driven by hybrid model expansion and broader economic recovery. Management emphasized its commitment to hybrid technology and said it is monitoring developments in electric vehicles and dual hybrid technology vehicles (DHTBs), though no timeline has been set for local DHTB production.

Despite policy uncertainty and rising competitive pressure, HCAR said it remains confident in its brand strength, localization efforts, and the early success of the HR-V Hybrid as it navigates Pakistan’s evolving automotive market.