Pakistan Automobile Industry
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GS Zhou
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I can understand the frustration about the disappear of the Pakistan indigenous automobile program. In China, we have a similar pain, which is the cancelation of the Y10 (a big passenger aircraft similar to Boeing 707) program in 1980s'.
But seriously, it is not easy for a small , or a less industrialized country (sorry, no offense at all), to build and maintain its own automobile industry. For countries other than Germany, Japan, China, USA, Korea, France, Italy, India, there are very few other countries could have the luxury to build and continually maintain their own auto industry:
- Czech used to own Skoda, but it was acquired by Volkswagen
- Russia used to keep a strong auto industry, but Lada, the top Russian car brand, was acquired by Renault
- Romania used to own Dacia, but it was acquired by Renault as well
- Malaysia used to have Proton, but it was acquired by Geely.
Automobile, fortunately or unfortunately, is a very scale-sensitive industry. Imagine you spent 500M USD to develop a new model, the lifetime sales at 500,000 cars vs. 5,000 cars, the R&D cost allocated to each unit is different; or if you spend 500M USD to build a new plant with annual capacity at 100k units; production at full capacity vs. 5%, the manufacturing overhead each car needs to carry is also different. For the top players e.g. VW or Toyota, they produce more than 10 million cars a year; such huge base gives it a great advantage in cost control, and makes the success rate of new challengers from developing countries very vey few.
What's even worse is the "price discrimination" even from home country customers. For example, suppose a local Pak auto company launches a vehicle that is as good as a Toyota RAV-4, how much an ordinary Pak consumer is willing to pay for it? The experience from China market is, for a Chinese-brand car that is as good as a Japanese or German brand car, the Chinese consumers today only willing to pay 55% to 65% of the price of the equivalent JP or GE car. The ratio at years before is even lower.
And how about Toyota to lower the price as the response? Remember the cost benefit it gained from its huge size.
I definitely believe Pakistan is a country with a huge potential to release, and automobile is definitely the direction that worth of a huge investment. But be prepared for the likely challenge. Automobile is indeed a very very challenging industry.
But seriously, it is not easy for a small , or a less industrialized country (sorry, no offense at all), to build and maintain its own automobile industry. For countries other than Germany, Japan, China, USA, Korea, France, Italy, India, there are very few other countries could have the luxury to build and continually maintain their own auto industry:
- Czech used to own Skoda, but it was acquired by Volkswagen
- Russia used to keep a strong auto industry, but Lada, the top Russian car brand, was acquired by Renault
- Romania used to own Dacia, but it was acquired by Renault as well
- Malaysia used to have Proton, but it was acquired by Geely.
Automobile, fortunately or unfortunately, is a very scale-sensitive industry. Imagine you spent 500M USD to develop a new model, the lifetime sales at 500,000 cars vs. 5,000 cars, the R&D cost allocated to each unit is different; or if you spend 500M USD to build a new plant with annual capacity at 100k units; production at full capacity vs. 5%, the manufacturing overhead each car needs to carry is also different. For the top players e.g. VW or Toyota, they produce more than 10 million cars a year; such huge base gives it a great advantage in cost control, and makes the success rate of new challengers from developing countries very vey few.
What's even worse is the "price discrimination" even from home country customers. For example, suppose a local Pak auto company launches a vehicle that is as good as a Toyota RAV-4, how much an ordinary Pak consumer is willing to pay for it? The experience from China market is, for a Chinese-brand car that is as good as a Japanese or German brand car, the Chinese consumers today only willing to pay 55% to 65% of the price of the equivalent JP or GE car. The ratio at years before is even lower.
And how about Toyota to lower the price as the response? Remember the cost benefit it gained from its huge size.
I definitely believe Pakistan is a country with a huge potential to release, and automobile is definitely the direction that worth of a huge investment. But be prepared for the likely challenge. Automobile is indeed a very very challenging industry.
ghazi52
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MG Motors receives Greenfield status to manufacture cars in Pakistan
SAMAA | Bilal Hussain
Jan 14, 2021
Greenfield status is granted to car assembly companies and includes tax and duty incentives to encourage new car companies entering the Pakistani market.
The company has already launched its compact SUV MG-HS and has revealed its plans to launch more cars including MG-ZS 1.5, MG ZS EV, which is fully electric and has 44.5 KWH of power, pick-up truck MG-Extender and SUV RX8.
The Engineering Development Board general manager has confirmed that MG Motors has been given the green-field status to manufacture cars in the country.
MG Motors in Pakistan is a joint venture between Pakistan’s JW-SEZ and Chinese giant SAIC, which now owns the British MG Motors. The company may also manufacture SAIC’s other cars too.
Haier Pakistan CEO and Pakistan Super League franchise Peshawar Zalmi’s owner Javed Afridi is a key stakeholder in MG Motors in Pakistan. He said in a previous interview that they had a good experience in Pakistan’s auto industry after they launched commercial vehicles such as trucks under the banner of JW-Forland.
In the ground-breaking ceremony of MG Motors recently, Javed Afridi said that they have established a joint venture with SAIC Motors, which means that the Chinese company also made investments in Pakistan.
MG Motors is one of the car companies that came to Pakistan after the government announced its Auto Development Policy 2016-21.
The policy will end in June 2021 and industry sources say car-making companies, called ‘new entrants’ since they came to the country after the policy was announced, have been trying to launch the maximum number of models before its expiry.
By launching cars during this period, the companies will be able to get tax incentives for five years under the government’s scheme. The policy aims to boost the auto industry and encourage competition. Japanese Suzuki, Honda, and Toyota were the dominant players before Kia, Hyundai, and Changan entered the market after 2016.
SAMAA | Bilal Hussain
Jan 14, 2021
Greenfield status is granted to car assembly companies and includes tax and duty incentives to encourage new car companies entering the Pakistani market.
The company has already launched its compact SUV MG-HS and has revealed its plans to launch more cars including MG-ZS 1.5, MG ZS EV, which is fully electric and has 44.5 KWH of power, pick-up truck MG-Extender and SUV RX8.
The Engineering Development Board general manager has confirmed that MG Motors has been given the green-field status to manufacture cars in the country.
MG Motors in Pakistan is a joint venture between Pakistan’s JW-SEZ and Chinese giant SAIC, which now owns the British MG Motors. The company may also manufacture SAIC’s other cars too.
Haier Pakistan CEO and Pakistan Super League franchise Peshawar Zalmi’s owner Javed Afridi is a key stakeholder in MG Motors in Pakistan. He said in a previous interview that they had a good experience in Pakistan’s auto industry after they launched commercial vehicles such as trucks under the banner of JW-Forland.
In the ground-breaking ceremony of MG Motors recently, Javed Afridi said that they have established a joint venture with SAIC Motors, which means that the Chinese company also made investments in Pakistan.
MG Motors is one of the car companies that came to Pakistan after the government announced its Auto Development Policy 2016-21.
The policy will end in June 2021 and industry sources say car-making companies, called ‘new entrants’ since they came to the country after the policy was announced, have been trying to launch the maximum number of models before its expiry.
By launching cars during this period, the companies will be able to get tax incentives for five years under the government’s scheme. The policy aims to boost the auto industry and encourage competition. Japanese Suzuki, Honda, and Toyota were the dominant players before Kia, Hyundai, and Changan entered the market after 2016.
The Accountant
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Yes 50% lower import duty for new players. I feel that sooner of later japnese cars will have to move out of Pakistani market specially from low price and medium price vehicles.
Yes 50% lower import duty for new players. I feel that sooner of later japnese cars will have to move out of Pakistani market specially from low price and medium price vehicles.
The Accountant
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Unfortunately we as a nation are so stupid for us bhutto is still alive.
Just 5 minutes ago i was discussing with an educated youg guy and he was saying that bhutto was the best leader in pakistan till to date
ghazi52
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Automobile sale rises 44pc in January
APP
11 Feb 2021
ISLAMABAD: Sale of cars in the country increased by 44 per cent in January compared to same month of the preceding year, a data released by Pakistan Automobile Manufacturing Association (PAMA) said on Thursday.
Sale of cars rose to 14,543 units in January compared to 10,095 units during same period of previous year.
Sale of cars during first seven months (Jul-
Jan) also increased by 18 per cent when compared with the sale during same period of the year 2019-20.
According to the data, as many as 81,569 cars were sold in the period under review as compared to 69,189 units in same period of last year.
The breakup figures show that 2,063 units of Honda civic and city were sold during January this year as compared to the sale of 1,878 units last year, thus showing a jump of 9.85 percent.
Toyota Corolla cars’ sale however witnessed negative growth of 55.7 percent as it went down to 1,525 units in the corresponding month from 3,445 units in same period of previous year.
Suzuki Swift’s sale made a jump of 152 percent as its sale increased to 364 units from 144 units in January 2020.
Similarly, the newly launched Toyota Yaris also witnessed an increase of 107 percent as its sale jumps from 1,440 units in December 2020 to 2,992 units in January 2021.
Sale of Suzuki Cultus declined to 1,470 units in the month under review whereas during same period last year, the sale was recorded at 1,701 units.
The sale of Suzuki Wagon R witnessed a sharp increase to 1,316 units from 567 units in January last year.
Suzuki Alto also witnessed a decrease as it went up from 2,360 units in January 2020 to 4,813 units in same month of current year.
Meanwhile, sale of motorbikes witnessed a rise of 14 percent as it rose to 162,564 units in January compared to sale of 142,445 units in same month of last year.
- Sale of cars rose to 14,543 units in January compared to 10,095 units during same period of previous year.
APP
11 Feb 2021
ISLAMABAD: Sale of cars in the country increased by 44 per cent in January compared to same month of the preceding year, a data released by Pakistan Automobile Manufacturing Association (PAMA) said on Thursday.
Sale of cars rose to 14,543 units in January compared to 10,095 units during same period of previous year.
Sale of cars during first seven months (Jul-
Jan) also increased by 18 per cent when compared with the sale during same period of the year 2019-20.
According to the data, as many as 81,569 cars were sold in the period under review as compared to 69,189 units in same period of last year.
The breakup figures show that 2,063 units of Honda civic and city were sold during January this year as compared to the sale of 1,878 units last year, thus showing a jump of 9.85 percent.
Toyota Corolla cars’ sale however witnessed negative growth of 55.7 percent as it went down to 1,525 units in the corresponding month from 3,445 units in same period of previous year.
Suzuki Swift’s sale made a jump of 152 percent as its sale increased to 364 units from 144 units in January 2020.
Similarly, the newly launched Toyota Yaris also witnessed an increase of 107 percent as its sale jumps from 1,440 units in December 2020 to 2,992 units in January 2021.
Sale of Suzuki Cultus declined to 1,470 units in the month under review whereas during same period last year, the sale was recorded at 1,701 units.
The sale of Suzuki Wagon R witnessed a sharp increase to 1,316 units from 567 units in January last year.
Suzuki Alto also witnessed a decrease as it went up from 2,360 units in January 2020 to 4,813 units in same month of current year.
Meanwhile, sale of motorbikes witnessed a rise of 14 percent as it rose to 162,564 units in January compared to sale of 142,445 units in same month of last year.
Indus Pakistan
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Thetitle of this thread should reflect the truth. Pakistan does not have automobile industry. It has kit-car industry. Meaning parts are bought from foreign auto industries [mostly Japanese] and then just bolted together in Pakistan.
The Accountant
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Wait for new auto policy
ghazi52
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Consortium of Daewoo, Skywell & Hitachi to Launch Electric Buses in Pakistan
In a significant development, which took place yesterday, Daewoo Express Pakistan, Skywell China, and Hitachi ABB Power Grids Sweden reportedly signed a Memorandum of Understanding (MoU) to launch Electric Buses in Pakistan.
As per a media report, the MoU entailed that the three parties shall jointly set up a complete EV charging infrastructure and a value chain of electric buses and Electric Vehicles (EVs) in Pakistan to manufacture, assemble, and sell the vehicles in Pakistan and then export them to other countries.
The meeting was conducted through a live video call, which saw the participation of Governor Punjab, Chaudhry Muhammad Sarwar, and the ambassadors of the People’s Republic of China, South Korea, Switzerland, Sweden, and Japan.
In a significant development, which took place yesterday, Daewoo Express Pakistan, Skywell China, and Hitachi ABB Power Grids Sweden reportedly signed a Memorandum of Understanding (MoU) to launch Electric Buses in Pakistan.
As per a media report, the MoU entailed that the three parties shall jointly set up a complete EV charging infrastructure and a value chain of electric buses and Electric Vehicles (EVs) in Pakistan to manufacture, assemble, and sell the vehicles in Pakistan and then export them to other countries.
The meeting was conducted through a live video call, which saw the participation of Governor Punjab, Chaudhry Muhammad Sarwar, and the ambassadors of the People’s Republic of China, South Korea, Switzerland, Sweden, and Japan.
ghazi52
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Hyundai Nishat has started the assembly of its new Elantra sedan in Pakistan, and plans on launching it very soon.
Hyundai's new sedan will be priced between Rs 3.6 million to Rs 4 million and will directly compete Honda Civic and Toyota Corolla. As automakers are rushing to launch new cars in the Pakistani market before the end of the Auto Policy in June 2021, Japanese automakers, particularly Toyota and Honda, will be facing tough competition in the coming future.
Hyundai's new sedan will be priced between Rs 3.6 million to Rs 4 million and will directly compete Honda Civic and Toyota Corolla. As automakers are rushing to launch new cars in the Pakistani market before the end of the Auto Policy in June 2021, Japanese automakers, particularly Toyota and Honda, will be facing tough competition in the coming future.
Kai Liu
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Among all cars 'exported' from india, 99% are from foreign brands like Suzuki, etc. The real 'exports' from indian brands is negligible.
Among China's over 1 million cars exported each year, 99% are from Chinese brands like SAIC, etc.
About 'quality', among ~30 million cars sold in China every year, 40% are from Chinese brand; among ~300 million cars running on our roads, 40% are from Chinese brand. Cars run perfectly day and night, and no one is complaining.
World's largest car companies by production volume from their own brand cars, SAIC, Geely and Changan etc are well on the road to become the top 10 car companies worldwide:
World's largest car companies by market value, which tells you something about the future trend, BYD rank the 3rd and NIO the 5th:
Chinese traditional car companies are doing well, but Chinese EV companies are going to rule the world.
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