Pakistan Automobile Industry

Topics: Renault, Suzuki, Automotive industry Pages: 7 (1958 words) Published: May 3, 2011
Overview of Automobile industry, Pakistan:

Automobile market is one of the largest segments in world trade. In a fast globalized world, this industry is facing huge challenges like cutting cost, upgrading models, improving fuel efficiency and enhancing customers comfort without compromising quality. I categories automobile industry of Pakistan in different phases.

In first phase, automotive assembling of Bedford truck followed by ford perfect, ford Cortina and Dodge Dart started in 1950s in Pakistan. By the end on the 1970’s the assembling of vehicles came to a freeze due to the low quality value of locally produce vehicle parts but continued the assembling of Bed Ford trucks. By the end of 70s practically all assembling ceased in Pakistan.

In 1983, second phase of automobile assembling started with the introduction of Suzuki FX 800 CC car. And with in six years Pak. Suzuki changed the model of FX 800 CC with Mehran 800 CC. Pak. Suzuki there after introduced Khyber 1000 CC and Margalla 1300 CC in 1992. But in more than ten years, level of participation in development was not significant.

From 1993, Pak automobile industry moves toward development when Indus motors company Ltd. Karachi introduced Toyota Corolla and Honda atlas cars Ltd., Lahore introduced Honda Civic having 1300 CC engine capacity. Smaller cars also introduced by Indus motors, Pak Suzuki and Deewan Farooq motors in 2000. I.e. Cuore 850 CC, Cultus 1000 CC, Santro hundai 1000 CC.

Automobile industry in Pakistan can be broadly divided into following segments:

• Cars & Light Commercial Vehicles.
• Trucks and Buses.
• Tractors.
• Vendor Industry.

It is the industry which operates under franchises and technical cooperation agreements with Japanese, European and Korean manufacturers.

• Two and Three Wheelers

Public companies that are traded on Pakistani stock exchanges.

Automobile assembler

• Ghandhara Industries
• Ghandhara Nissan
• Hinopak Motors
• Hyundai Motors
• Indus Motors Company
• Master Motors
• Millat Tractors
• Pak Suzuki
• Sigma Motors
• Volvo Pakistan Limited
• Al-Ghazi Tractors
• Atlas Honda
• Dewan Farooque Motors (BMW Pakistan)
• Ghani Automobile Industries

Pakistan Automobile industry at Present:

The automobile industry has been strugglers ever since its creation. Although long time has past since its establishment, it has not been able to make a mark among the very stars of the automotive world.

Although it has tried and made significant advancement towards the production of locally produced vehicles transfer of new technology has become a major weakness of the industry. Another reason for the low progress of the industry is due to the high cost of fuel in Pakistan. People have made adjustments to their vehicle by changing their fuel preferences from petrol to CNG, just to get by in their lives. The Pakistani industry has so far being unable to adopt the GLOBALLY GREEN notion and safety standards. Most cars in the country rely on dual fuel systems. Moreover Pakistani industry is still relying on car models which have long been stopped producing in other super power countries. Pak Suzuki has gained almost complete monopoly in the segment of producing small cars and faces almost no competition at all.

The government policies and regulation of the state bank of Pakistan too contribute a great deal of being a wall between the Pakistani automobile industry and its success. By increasing the interest rate on car financing the industry has suffered a huge shift towards downfall.

Increasing Demand for Cars:
In Pakistan context there are 9 cars in 1,000 persons which is one of the lowest in the emerging economies which itself speaks of high potential of growth in the auto sector and more so in the car production. Rising per capita income with changing demographic distribution and an...
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