What is smuggling? Import without paying taxes.
Why are taxes placed on import? Because of low competitiveness of the local industry.

So the incompetent local industry first lobbies the government to apply taxes, then they guilt-trip the nation into buying their overpriced stuff — or the artificially overpriced imported stuff.

Typical signs of abusive relationship.

How patriotic is it to cause financial hardship and suffering to your fellow countrymen just because of your lack of business competitiveness?

Is the whole automotive sector a bunch of abusive-manipulative psychopaths?

He said that even though smuggled tires were of inferior quality, people were buying them due to their low prices without knowing the repercussions.

This is pathetic PR. First of all the smuggled tyres are not of inferior quality. Does he want to say that Hankook, Bridgestone, Sumitomo, Falken, Dunlop and Michelin are inferior than what he is producing? Some of the smuggled tyres may be counterfeit but all of them? No way.
How has he totally convinced himself that the 3rd world standard being produced in Pakistan is superior than first-world manufacture?

Secondly he insulted the intelligence of the customer. He should ask himself what exercise has he done to make the customer aware about those so-called repercussions. The only education he is imparting to the customers is playing on emotional appeal that is patriotism = taxes in his theory.

This kind of behavior is totally abusive that says customers themselves are the problem.