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Wednesday, September 28, 2022

Pakistan needs its indigenous car brand, here is why

Pakistan’s automobile industry is one of the fastest-growing in the country, with a 171 percent increase in production between 2014 and 2018. As of 2018, it generates 3% of Pakistan’s GDP and employs approximately 3.5 million people. Pakistan automotive industry contributes roughly Rs 50 billion (US$310 million) to the national budget.

Here are some of the cars from different countries: https://www.youtube.com/watch?v=Pe-KuniK68g&ab_channel=EpicUpdates

Pakistan is one of Asia’s smallest yet fastest-growing auto markets. Honda, Toyota, and Suzuki currently dominate the vehicle market. On the other hand, on March 19, 2016, Pakistan passed the “Auto Policy 2016-21,” which provides tax breaks to new automakers looking to open manufacturing plants.

Renault, Nissan, Proton Holdings, Kia, SsangYong, Volkswagen, FAW, and Hyundai have all expressed interest in joining Pakistan’s market in response. MG Motors brought electric vehicles to Pakistan, JW Automobile Pakistan has signed a Memorandum of Understanding (MoU) with Morris Garages (MG) Motor UK Limited, which is owned by SAIC Motor. Jolta Electric began producing electric motorcycles on July 8, 2021.

Pakistan’s own car Brand

Based on the above data we can realize how the automotive industry is flourishing in Pakistan and how much it is contributing to the national economy. But the question is, Why are we giving incentives to all these foreign car brands in Pakistan? Why shouldn’t we have our own car brand and use it?

The first “Made in Pakistan” Oshan X7 SUV exported

As the above data suggests, there are a number of car brands that are imported to Pakistan or are manufactured in Pakistan. It is right that all these brands are providing jobs to the local Pakistani’s and are generating revenue but our own indigenous car brand will help the country get the most out of the flourishing auto sector. Below is a detailed argument to have our own car brand rather than just a assembly point.

Manufacture instead of Assemble

As all the brands in Pakistan have assembly points in Pakistan. Parts are already manufactured in other countries losing the profit from these parts. If the parts were also to be manufactured in Pakistan, a bug chunk of population will benefit from these areas.

Pakistan have so many brands now and even now Pakistan have started exported Made in Pakistan SUVs  but these cars will always be identity of the origin country. Changan will always be known as Chinese brand while Proton will always be referred as Malaysian brand. We need a real Made in Pakistan car.

Foreign Investment in Local brands

Pakistan have a number of car brands that are assembling cars in Pakistan which are working because Pakistan have made investments in these car brands for local manufacturing and assembling. If Pakistan makes its own car brand, the new brand will attract investors. It will not only work as a marketing tactic but will also improve the reputation of the local car brand.

UEFA Champions League Final’s Football was “Made in Pakistan”

Reduced Imports

Currently, Pakistan is either importing cars or importing parts for local manufacturing and assembling. If Pakistan decides on making a local brand with locally manufactured parts it will not only reduce the prices of the cars but will also reduce the imports. Reduced imports help any country to improve its GDP and to keep the prices of vehicles in local control.

Increased Exports

If Pakistan ever gets successful in launching its own car brand, it will help the country itself with affordable prices but will also create a new market for these cars. Currently Pakistan is manufacturing JF-17 thunder fighter jets which not only have helped the country’s own production and reduced import bills but have also attracted other countries to invest in it and benefit from it.

Research and Development.

The automotive industry is one of the most profitable industry in the world and Research & Development is a main discipline. Latest technologies are adapted to make the cars better, safe and intelligent. For locally assembled cars, the research and development is already done in the origin countries and it enters the Pakistan market after the R&D is done, design is finalized and everything is optimized.

Haier begins exporting “Made in Pakistan” appliances to African countries

If we had a local car brand, the Research and Development will be done locally. Local R&D will get funding from other countries while R&D will be done in the local Universities by the local engineers, doctors and other experts. It will not only improve the skills of the locals but will also create an identity for the local car brands.

Requirements Based Changes

A local car brand will give the ease to change the features and details as per the local requirements. Pakistan Imports cars and other vehicles from other countries but if we need a vehicle-specific requirement e.g. Security Vehicles, Emergency Vehicles, different terrain vehicles etc.

For all the specific requirements, the origin country brand is requested with the requirement details a bulk of money is to be paid as the company keeps a chunk of profit for the specific requirements.

Made in Pakistan is identity of Pakistan

Locally manufactured car will give the country an identity. German cars have become the identity of quality and safety all over the world while Japanese Hybrid have created a specific place all over the world. A local brand that might be the affordability will give Pakistan an identity. The countries who prefer old/ cheap cars can then go for an affordable car from Pakistan.

Foreign Investment means Profit sharing

The important thing is all the car brands have invested in Pakistan with some local companies. Cars are mostly assembled as parts are being imported which already increases the prices of the cars. The most important thing is when the cars and other vehicles are sold, the major share of the profit is taken by the investor from the other country and a small share is left with the local company.

Toyota plans to roll out locally assembled hybrid electric vehicles in Pakistan by 2024

Breaking the Market Monopoly

Pakistan automotive market is captured and lead by the three car makers Honda, Suzuki and Toyota. Although number of new car brands have entered the market but still the 3 leaders are setting the trends. For example if 1 of the 3 car brands increase car prices in Pakistan, all the cars increase it to stay in news and in competition. That is the reason Pakistan car prices are increased without regulation or any control.

State owned or a Made in Pakistan car can break this monopoly as it will be introduced for a purpose to serve. As it can be made from scratch locally, it will be much more affordable and accepting to stay in an affordable price range.

Pakistan’s own Car brand from History

The Proficient pickup may be unfamiliar to today’s generation. It was Pakistan’s first locally produced 1,000cc pickup, created in the mid-1980s by local engineer Mr. Khalil ur Rahman (late). Proficient vehicles were just as good as any foreign brands and were also less expensive. It largely competed against the Suzuki in the small pickup and medium truck sector.

Issues faced by locally manufactured “Proficient” Car

The Proficient pickup may be unfamiliar to today’s generation. It was Pakistan’s first locally produced 1,000cc pickup, created in the mid-1980s by local engineer Mr. Khalil ur Rahman (late). Proficient vehicles were just as good as any foreign brands and were also less expensive. It largely competed against the Suzuki in the small pickup and medium truck sector.

The bestseller car of Pakistan – SUZUKI ALTO!

The predicament in which these manufacturers find themselves is indicative of the bureaucratic quagmire in which most local projects find themselves. Assistance from numerous government authorities is necessary to demonstrate the project’s feasibility, ranging from the provision of basic utilities such as electricity, water, and telephones to export licenses and sales tax exemption. However, most of these facilities will not be granted until the respective agencies are sure that the project is viable.

Can Pakistan make its own car brand

Pakistan the the country that manufacture JF-17 and Al-Khalid Tanks. Pakistan is currently manufacturing its indigenous Drones for security purpose. For the above products R&D is done by the local scientists in the local universities and institutions.

What should be done?

To make the dream come true to have an own identity brand of Pakistan the government need to take some revolutionary steps and break the ice and do something big that can change the image of the country on the global canvas.

Ericsson invested Rs 5.52 billion in Pakistan, plans to double it in 2022.

  1. Encourage Entrepreneurs for come up with ideas of a local, efficient and identity vehicle. Tax evasions should be done for local designing and manufacturing instead of to imported cars.
  2. Set a focus for the features of a local car. Pakistan can think out of the box and focus on what it actually needs. Do Pakistan need a sports car, electric car or maybe just a safe and fuel efficient car. An affordable safe car will capture the entire world’s focus and so many countries have these requirements. Here some car brands from different countries: https://www.youtube.com/watch?v=EXk_2d8QlE4&ab_channel=EpicUpdates
  3. Funding should be provided to startups, universities and other companies to work on making efficient designs, ensuring safety at affordable prices and to manage manufacturing cars from 100% local products.
  4. Support local companies to work on recycling of vehicle parts and other reusable products to control the price of the local manufactured cars.

 

 

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