Police said a 3-kg device was placed outside a car rental shop in the affluent southern quarter of the city on Saturday.
The attack occurred at around 6.30am (0130 GMT). Witnesses said the explosion was so big it threw up paving stones and made a crater over half a metre deep.
Karachi police spokesman Favvaz Leghari said the security services had not yet been able to determine the motive behind the bombing, but were persuing a particular line of investigation.
However Aljazeera's correspondent in Pakistan, Ahmad Barakat, said police suspect the bombing might involve a mafia group.
A security source said the showroom was owned by Muhammad Akram who was under investigation for his connections to prominent mafia members as Shuaib Khan and Dawud Ibrahim - already a fugitive from Indian authorities.
But the Interior Minister Makhdum Hayat said police were not discounting the possibility that the attack might be linked to an al-Qaida-linked group.
A spate of terror attacks has rocked Karachi, a teeming city of more than 14 million people, since Pakistan joined the US-led war on terrorism in 2001.