KEY POINTS
- Global buyers could benefit as Chinese firms slash EV prices
- Automakers may shift production to Pakistan, India, Bangladesh
- Trade barriers in Europe, US may divert cars to developing markets
- Concerns over service, reliability remain for foreign consumers
ISLAMABAD: China’s auto industry, once the crown jewel of its manufacturing rise, is now in turmoil after years of overproduction, however, the fallout could bring cheaper cars and fresh opportunities to South Asian consumers and economies.
International buyers, particularly in countries such as Pakistan, India, and Bangladesh, may find themselves at the centre of this shift. As domestic demand in China falters and trade barriers tighten in the United States and Europe, industry analysts and manufacturers such as BYD and Chery are increasingly eyeing developing markets as their next growth frontiers, Reuters reported.
“This means cars will get cheaper, and Chinese brands will aggressively enter South Asia with electric vehicles that could undercut Japanese and Korean rivals by thousands of dollars,” an auto market consultant in Mumbai told The Guardian. “For the consumer, the prospect of buying an affordable EV just got closer,” he added.
Pakistan, India, and Bangladesh are already grappling with rising fuel costs and air pollution, pushing governments to consider faster adoption of electric mobility. Officials in Dhaka told The Business Standard that Chinese carmakers have held informal talks about the possible assembly plants. Meanwhile, trade sources in Karachi say dealerships are preparing to expand offerings of Chinese EVs as early as next year.
In Pakistan, several Chinese brands already have a visible presence, with Changan and MG selling compact SUVs and sedans that have attracted middle-class buyers. The arrival of cheaper Chinese EVs could further reshape the local market, where Japanese automakers have traditionally dominated. Dealers say lower-cost EVs may appeal to families eager to contain fuel bills. Notwithstanding, the lack of charging infrastructure remains a challenge.
When the promise of lower prices excites buyers, experts caution that quality and service issues may persist. “If companies dump cars in developing markets without strong after-sales networks, the consumer ends up carrying the risk,” an executive from a regional dealership association told Reuters.
China’s domestic oversupply has been so severe that, according to Reuters, some dealers were forced to register cars as “sold” on paper merely to claim subsidies, and others marked unused vehicles as “used.” If these practices spill over into export markets, consumer trust could be tested.
For South Asian governments, the crisis could also open unexpected opportunities. Analysts at Caixin noted that relocating parts of production to lower-cost countries would allow Chinese firms to dodge tariffs while creating jobs abroad. India’s vast auto sector could benefit from joint ventures, while Pakistan and Bangladesh, with lower labour costs, might attract assembly operations targeting regional markets.
For the ordinary consumer, however, the most immediate impact will be in the showroom: cheaper EVs. “If this price war continues, families in Lahore or Dhaka who never dreamed of owning an electric car may suddenly find one within reach,” a transport economist told The Guardian.
Yet the long-term picture remains uncertain. Should Beijing allow consolidation, some brands may vanish, leaving foreign buyers with cars that lack warranty support or spare parts. As one European supplier quoted in Reuters warned, “If cars are sold below cost, eventually someone pays — and it may well be the buyer abroad holding a vehicle whose maker has gone bankrupt.”
For now, consumers across South Asia are watching closely. A crisis in China’s auto sector may deliver just a windfall of affordable electric cars — or it may saddle developing markets with short-lived bargains and long-term headaches.
