Bangladesh’s car market has fallen into one of its deepest slowdowns in years as rising vehicle prices, weaker purchasing power and economic uncertainty force middle-class buyers out of the market, according to Bangladesh Reconditioned Vehicles Importers and Dealers Association (BARVIDA) President Abdul Haque.
In an interview with TIMES of Bangladesh, he said sedan registrations in 2025 dropped below 10,000, down sharply from nearly 25,000 three years ago.
The decline reflects a broader contraction in private passenger vehicle demand as exchange rate pressure, fuel price hikes and higher import costs continue to push vehicles beyond the reach of many consumers.
“A car that cost Tk20 lakh five years ago now costs around Tk30 lakh,” Haque said.
While some corporate purchases are continuing, individual buyers are increasingly stepping away from the market due to financial pressure, according to him.
He also identified the rapid expansion of battery-powered auto-rickshaws as a major but largely overlooked factor behind falling private car demand.
With low operating costs and cheap fares, the vehicles are increasingly replacing the need for personal transport for many urban commuters, he said.
“Many people now think, why buy a car when they can travel for Tk30 or Tk50?” he said.
Several lakh battery-run auto-rickshaws are already operating across the country, although their broader economic impact on the automobile sector has not been properly assessed, he added.
Haque said the political and economic disruptions since 2024 further weakened consumer confidence and spending capacity, with the impact continuing into 2026.
According to him, many high-spending consumers who drove vehicle sales over the past decade are also no longer actively participating in the market.
Despite the rapid rise of Chinese electric vehicle (EV) manufacturers globally, Japanese reconditioned vehicles still dominate Bangladesh because of their durability, affordability and long-established consumer trust, he said.
“If I give you a car worth $8,000, that car can still run for 30 years,” he said.
He acknowledged China’s progress in EV technology, but warned that large-scale EV imports could increase pressure on Bangladesh’s foreign exchange reserves by driving up dollar outflows.
“If the government reduces duties, it loses revenue, and at the same time, more dollars leave the country,” he said.
Japanese brands, particularly Toyota, built their reputation in Bangladesh over five decades by offering reliable vehicles suited to local road and economic conditions, according to him.
Indian vehicles have not achieved the same consumer confidence in the local market, while German brands remain costly to maintain for average buyers, he added.
Calling for a long-term automobile policy, Haque said Bangladesh should adopt a gradual and realistic transition plan aligned with the country’s economic capacity and consumer purchasing power.
“There should be a clear 10-year plan so people can gradually adjust. Bangladesh is not a developed country. We must make decisions carefully, based on our own reality,” he said.
