Like other auto makers around the world, Tata Motors is also contending with declining demand, both for its bread-and-butter commercial vehicles in India and its luxury brands, Jaguar and Land Rover. The company reported its first quarterly net loss in seven years in the October-December 2008 quarter, and saw its debt rating cut by ratings firms. More immediately, Tata Motors faces a June deadline to repay $2 billion in loans related to its Jaguar-Land Rover acquisition from Ford Motor Co. last year, according to the Wall Street Journal.
The automobile industry in India—the tenth largest in the world with an annual output of 2 million units last year—is expected to become one of the major global automotive industries in the future. A number of domestic companies produce automobiles in India and the growing presence of multinational investment, too, has led to an increase in overall growth. Following the economic reforms of 1991 the Indian automotive industry has demonstrated sustained growth as a result of increased competitiveness and reduced restrictions. The monthly sales of passenger cars in India exceed 100,000 units, according to a related Wikipedia entry.
In comparison with the rest of the world, the Chinese market for automobiles appears to be relatively robust. Monthly auto sales in China surpassed those in the U.S. for the first time in January, but automakers and industry watchers say the news may tell us more about the troubles in the U.S. than about China's growing car market, says a report published in San Francisco Chronicle.
Data released in February by the China Association of Automobile Manufacturers shows 735,000 new cars were sold in China last month, down 14.4 percent from the record of 860,000 set in January 2008. U.S. sales, meanwhile, fell 37 percent to 656,976 vehicles — a 26-year low.
In Pakistan, Engineering Development Board (EDB) is attempting to increase the GDP contribution of the automotive sector to 5.6%, boost car production capacity to half a million units as well as attract an investment of US$ 3 billion and reach an auto export target of US$ 650 million.
In addition to the growing defense industry, auto industry can become a driving force for the much needed manufacturing industrial base in Pakistan to create significant employment opportunities for its large population. Last year, the auto sector contributed US$ 3.6 billion, only about 2% of the GDP, to the national economy, and employed about 192,000 people.
Pakistan's auto parts manufacturing is a billion US dollars a year industry. Sixty percent of its output goes to the motor cycle industry, 22% is for cars, and the rest is consumed by trucks, buses & tractors.
After a significant growth spurt in 2002-2006, the auto sector is feeling the pain of economic slow-down in Pakistan. The industry is continuing in a slump which began in the previous financial year and according to Business Monitor International's recently published Pakistan Automotives Report, the industry’s performance this year will get worse. In FY08, which ended in June 2008, total vehicle sales fell by 6.2%. The downturn carried over into FY09, with sales for the first half of the year (July to December 2008) down by 48% year-on-year to 52,927 units for cars and light commercial vehicles (LCVs), while compared with November, sales for December were down 55%. These results support BMI’s forecast for a drop in sales of cars and LCVs to around 112,000 units in FY09. BMI expects the total auto market in Pakistan to contract by over 32%, with the worst damage done in the car and bus segments, which is forecast to fall by 45% each. Pakistan’s Economic Co-ordination Committee (ECC) is to consider a tax cut of 10% for domestic car manufacturers, which has been proposed by the Ministry of Industries and Production. However, the plan is not without its opposition, as the Federal Board of Revenue is reportedly against supporting individual sectors as this would prompt other industries to seek help. Moreover, with just five carmakers producing locally, the automotive industry is relatively small. On the other hand, the industry is also largely self-sufficient as the majority of its output is sold within Pakistan; this reduces the country’s reliance on imports and raises issues such as the protection of local jobs and the industry’s contribution to the overall economy.
Among the automakers, Indus Motors and Pakistan Suzuki reported positive earnings: The two leading car assemblers PSMC and INDUS posted positive earnings for 2008. PSMC reported operating losses of Rs 399 million. However, increase in other income by 77 percent offset their losses helping PSMC post positive earnings of Rs 26 million, according to Daily Times. Honda posted a loss after tax of Rs 190 million for the period July-December 2008 after a decline in net sales by 5 percent and a massive surge in operating expenses over the corresponding period last year.
The poor state of the industry is reflected in BMI’s Business Environment Rating for the automotive industry in Asia Pacific, where Pakistan is in last place on a score of 42.4 out of a possible 100. The market is held back by low production growth potential and an average rating for sales growth. However, as a signatory to the Trade Related Intellectual Property Rights Agreement (TRIPS) under the auspices of the World Trade Organization (WTO), the country’s regulatory environment scores well. A number of free trade agreements also contribute to this criterion, although forming FTAs with non-Asian countries would improve this rating further. Despite low marks for bureaucracy and corruption, the market does score well for its long-term economic risk and policy continuity.
With just a handful of manufacturers, Pakistan’s competitive landscape remains narrow. Japanese car manufacturers control most of the country’s passenger car production and sales. Figures for FY08 show that Suzuki-brand models represented 62% of total Pakistani passenger car production and 51.7% of sales. Toyota is gaining, however, with Corolla becoming the country’s best-selling model in the first half of FY09.
According to Daily Times, as many as 60,000 workers and staffers in Pakistan's auto sector have lost their jobs from July, 2008 to January, 2009 due to falling demand for cars. More jobs cuts are feared with continuing weakness in demand.
Given strong underlying growth dynamics in South Asia, the negative feedback effects of the global financial crisis are expected to be temporary. A relatively rapid rebound is expected in 2010, with a projected revival of GDP growth to 7.2 per cent. The long term prospects for the auto industry in the continent of Asia appear to be quite favorable. As the current financial crisis ebbs, there will be significant pent-up demand for automobiles in Asia, including India, Pakistan and China, that will drive the growth in auto industry.
Related Links:
Pakistan Automobiles Report 2009
Auto Pakistan Expo 2009
Pakistan Automotive Report
China Surpasses US in Auto Sales
Auto Industry in India
India's Global Shopping Spree
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Recently, Mark Mobius of Franklin-Templeton Funds explained that for "our (Franklin Templeton's) Asia growth funds, we have been buying Pakistan Telecom, MCB Bank, and Indus Motor, which is a Toyota (TM) assembler and distributor". All three of these companies are listed on Karachi Stock Exchange.
Here's a Daily Times report about Pakistan exporting buses to UAE:
KARACHI: The export of buses to the United Arab Emirates (UAE) by Hinopak is starting and the first batch of 25 buses will be shipped in the current month to the Emirates Transport, UAE primarily for transportation of schools.
Hinopak Director Sales and Marketing Muhammad Irfan Shaikh said this while addressing the export ceremony of the first batch of 25 units of Hino AK8J Buses to UAE. .
Irfan said that by successfully meeting international standards in export quality, Hinopak in collaboration with its principals, is continuously striving to tap other prospective markets such as Saudi Arabia, Qatar, Oman, Kuwait, Egypt, Bahrain, UAE, Jordan and many inquiries are in the pipeline from Panama, Mozambique, Cost Rica and Sub Sahara countries. He mentioned that Hinopak has invested huge amount of money to renovate its body operation plant by keeping in view the expected orders of export from different parts of the world.
Provincial Transport Minister Akhtar Ali Jadoon said that the Sindh government is planning to operate 100 diesel buses in Karachi soon under the Benazir Transport Programme. He said that CNG bus project with 400 units would also start soon.
Trade Development Authority of Pakistan Chief Executive Mohibullah Shah appreciated Hinopak’s efforts and highlighted that for the past several years the economy of Pakistan has been undergoing a slump, marred by both international and domestic factors directly affecting the trade sector very badly.
He further added that this export segment would not only bring honour and fame, but would definitely strengthen the image of Pakistan around the world and help the country in narrowing down the trade imbalance.
Hinopak Managing Director and CEO Hideya Iijima said that these buses are especially designed considering the geographic, climatic and economical conditions of the destined country. He also said that one of the key features of Hinopak buses is the option of massive customisation in all aspects of the bus body from layouts, seating arrangements to various colour schemes.
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Excerpts from KPMG reports on Pakistan's auto sector:
Total auto sales in Pakistan in 1H-FY2010 increased by 16.37% to 61,021 units from ... The auto industry was operating at 37% of its installed capacity of 273 thousand units per annum in FY2009 and it is expected that 20% YoY growth ... units in FY2009. Market players Honda Atlas, Pak Suzuki, Indus Motors, Mitsubishi, Dewan ...
Here's a BBC report on plunging Tata Nano car sales in India:
Sales of Tata Motors' Nano, the world's cheapest car, plunged by 85% in November compared with a year earlier, the Indian carmaker has said.
It blamed the slump on the difficulty potential customers had in accessing loans to buy the car.
However, analysts pointed out that a series of fires in the Nano, as well as price rises, had also affected sales.
Tata said its total sales across all models in November were 54,622, a rise of 1% on a year earlier.
The carmaker also said that sales of its Jaguar Land Rover-branded models "continued their upward trend".
Fire hazard
However, the company said it had sold just 509 Nanos during November.
During the month, Tata offered free safety upgrades for the model, which went on sale last year.
This came after owners of the hatchback reported about half a dozen fires since April last year. There were no injuries.
The Nano was introduced to India in April 2009 and there are now about 70,000 of them on the country's roads.
The basic Nano costs about 100,000 rupees ($2,205; £1,414).
Here is an excerpt from a recent Wall Street Journal artcle on CNG:
Of the 11.4 million natural-gas vehicles currently in use world-wide, most can be found in the developing world, according the International Association for Natural Gas Vehicles, an industry body. Pakistan led with way with 2.3 million as of December 2009, while Iran, Argentina, Brazil and India together accounted for six million more. In China, the number has more than doubled since 2007 to around half a million.
There is a network of 1500 CNG stations in Pakistan to fuel the 2.3 million CNG vehicles.
Not only is Pakistan self-sufficient in building cng kits for domestic use, it is also exporting these kits.
Here's a Tribuneindia report from 2008 titled "India lags behind Pak" in gas infrastructure:
New Delhi, May 5
India is way behind Pakistan in terms of its gas pipeline network, with the neighbouring country’s network stretching around 56,400 km against its 10,500 km, connecting only 20 cities compared to Pakistan’s 1,050, industry body Assocham said.
Pakistan’s pipeline density, at present is 1044 km/mmscmd (million metric standard cubic meter per day) per day compared to 116 km/mmscmd of India, Assocham said in its paper on gas sector ‘A Comparison between India and Pakistan’.
The neighbouring country has created a 31,000 km distribution network to serve its domestic and commercial consumers in large locations, against the 11,000 km network that have so far been build in India to serve the needs of its consumers in limited pockets, the report said.
While Pakistan has nearly 1,600 CNG stations, India has 380. The gas throughput in Pakistan is 38 mmscmd per day as against 8.5 mmscmd gas in India.
The number of gas customers and vehicles running on CNG in Pakistan is about 19 lakh and 15.6 lakh respectively, while in India the number is 5.50 lakh and 4.60 lakh.
“The gas availability in Pakistan is undoubtedly quite large, compared to India but given the imports of gas and even its domestic availability in India, its pipeline network is extremely poor and the main reason attributed for the low and limited pipeline network in India is because this sector has been thoroughly regulated which has now been opened for competition,” Assocham president Venugopal Dhoot said.
The paper added that since the pipeline network in India does not reach out to most of the potential demand centres, a number of industrial projects, which would ideally run on gas, have to depend on much more costlier and more polluting alternative fuels.
Auto sales regain momentum in December
Hyundai Motor India ,one of the country’s largest car manufacturer recorded a 17.6% rise over 22,252 units sold in December 2009. Hyundai Motor expexts the market to continue to grow in 2011 although the rate of growth may come down.
Mahindra & Mahindra vehicles segment also registered a growth of 28%, having sold 15,601 units in December 2010, as against 12,212 units during December 2009.Tata Motors vehicle business recorded 28% rise in its total domestic sales in December 2010 at 19,977 units as against 15,661 units in December 2009. Tata Nano sales also touched 5,784 units last month, about 60% higher over December 2009 .Ford India December sales were up 172%, with more than 60,000 units of Figa sold in India since its launch in March 2010.
Here's a BMI report on Pakistan's auto sector in 2010-2011:
Final data for 2010 (calendar year) passenger car sales within Pakistan show that a total of 134,757 passenger car units were sold from January-December 2010 period, and passenger car production was 130,625 in total for the calendar year.
Looking at trends at the halfway stage of FY10/11 (July to end June), total vehicle production was 106,810 units, an increase of 9.2% y-o-y on the 97,788 units produced over the same period in FY09/10. This is made up of 62,952 units passenger car production, 1,432 units truck production, 242 units bus production, 504 units jeep production, 8,961 units pick-up production and 32,719 units farm tractor production.
Total vehicle sales for H1FY09/10 were 102,469 units, an increase of 6.2% y-o-y on the 96,440 vehicles sold over the first half of FY09/10. This is made up of 59,646 passenger cars sold, 1,384 trucks, 243 buses, 381 jeeps, 8,072 pick-ups and 32,743 farm tractors.
All of which bodes well for the evolution of Pakistan’s auto sector over the current fiscal year. Our current forecasts are for total FY10/11 production to reach 221,583 units, with sales to reach 224,160 units. Considering the strong start to this fiscal year, there could be some upside risk to these forecasts. However, with car prices continuing to rise and continuing weak economic backdrop in the country, we refrain from making any changes to our forecasts this quarter. Moreover, a recent extension of the age of imported new cars allowed into Pakistan could also hit new car sales (see Page 6 for further information). Considering this mixed outlook for new car sales therefore, we shall await further data from the third quarter of FY10/11 before deciding if any further changes need to be made to our forecasts.
Certainly, the start of FY10/11 saw new car sales fall by 31.6% month on month (m-o-m), to 9,796 units in July, as customers felt the impact of an increase in General Sales Tax (GST) and with heavy flooding causing displacement of people and severe disruption to business across the country. However, this poor monthly performance did not mark the start of a negative trend, with the remaining five months of the calendar year all showing positive growth.
This upwards sales trend came as a surprise to most industry analysts, who had expected a combination of a weak rupee and falling income and demand from flood-affected areas to have sent car sales lower. It may be, however, that with the Pakistan rupee and consumer demand both set to remain weak into 2011, customers chose to buy new cars early in the current fiscal year, for fear that they will continue to increase in price over the coming months. Certainly, local media have speculated that this is what car dealerships have been doing, buying cars in at current prices to hedge against future likely price rises. Increase in imported used cars to meet demand
In January 2011 the Pakistan cabinet passed legislation extending the age limit on imported used cars from three years to five years as it tries to open up car ownership to poorer Pakistanis. The move follows the release of a report by the country’s Economic Coordination Committee which stated that the current import regime of about 30,000-40,000 cars a year was proving insufficient to meet growing demand for private vehicles.
Pak Suzuki Motors (PSMC) to gain from Punjab govt's yellow cab scheme, according to The News:
KARACHI: Pak Suzuki Motor Company (PSMC) stands to gain from the Yellow Cab Scheme announced by the government of Punjab in its budget for 2011/12, analysts said.
The provincial government has announced that a grant of Rs4.50 billion has been allocated for the scheme, which will partly finance 20,000 vehicles.
Contrary to the yellow cab scheme, the Nawaz Sharif government introduced in 1992/93, this scheme relies on locally-made vehicles.
‘Mehran’ and ‘Bolan’, the two most popular makes of Pak Suzuki, have been short-listed for the scheme.
The analysts said the ultimate beneficiary will be the PSMC, which has been suffering from appreciating yen, relaxation in import policy and production constraints since a tsunami-hit Japan.
Gross profit margin of the company has squeezed to mere two percent in 2010, which was around four percent a year back, they added.
Details of the scheme are yet to be unveiled, but it is expected that the vehicles would be 50 percent financed by the government of Punjab, while the buyer would have to pay the rest.
There are concerns of possible lack of transparency in financing.
Besides, there is a lack of clarity about the time period over which the scheme would be spread.
Furqan Punjani, an analyst at the Topline Research, said that there are possibilities that out of 20,000 only 12,000 to 15,000 units will go in the said scheme and the rest might fall victim to corruption.
An analyst at Arif Habib Research said that it is believed that PSMC’s car volumes would spike by nine percent and 16 percent in CY11E and CY12F.
Consequently, the earning pershare (EPS) of the company would improve by 75 percent and 116 percent in CY11E and CY12F, respectively, he said.
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=53955&Cat=3&dt=6/23/2011
India's transport system is the most dangerous in the world costing hundreds of thousands of innocent lives each year, but it's hunger that takes the biggest toll with over 7000 dying of hunger every day.
Here's a story from the Guardian titled "Indian roads officially the most dangerous in the world":
It is an unenviable statistic but India's chaotic roads are now officially the most dangerous place to drive in the world.
Last year road accidents claimed more than 130,000 lives – overtaking China, which has seen fatalities drop to fewer than 90,000, and prompting a government review into traffic safety that until now has been best summed up by local drivers as "good horns, good brakes, good luck".
Ministers are considering a range of new measures, such as making airbags and anti-braking system mandatory in all cars. Trucks may also be fitted with speed breakers in a bid to bring down fatalities.
However, many experts say that new laws will have little effect in India, where seat belts are rarely worn and where no one can anticipate with any certainty the behaviour of the average road user.
Nor can most road users guess what type of vehicle they will face – Delhi alone has 48 different "modes of transport" including cows, elephants and camels as well as cycle-rickshaws and SUVs.
Rohit Baluja of Delhi's Institute of Road Traffic Education says "the real issue is not car design but road design. About 85% of all deaths on the roads are pedestrians and cyclists not drivers. We do not design traffic management systems to separate different streams of traffic. In America this began in 1932".
http://www.guardian.co.uk/world/2008/oct/10/india
Here's a report in The Nation newspaper on Pakistan's auto parts industry:
The auto sector has taken initiative to organize the show for local auto part vendors to look for more export opportunities. Praising the efforts of local vendors in developing the engineering base and enhancing the skill sets of local engineers, they said that it is for the efforts of OEMs that local auto manufacturers have achieved 60 percent localization.
The auto sector is fully committed to localization process and has already developed 60 vendors and has arranged 34 technical assistance agreements for transfer of technology. In this regard, the IMC has invested Rs13 billion in development of internal infrastructure which includes Press Shop, Engine Shop and Paint Shop.
The OEMs have invested over Rs75 billion in local auto industry and it contributes more than 5 percent annually towards the national exchequer. Moreover OEMs and auto parts manufacturers employ around 200,000 people and supports employment of over 1,392,000 persons throughout its supply chain of vendors, suppliers and dealers.
The auto industry experts expressed confidence that the show will attract local and foreign investors and that the local auto industry will get support from government and policy makers which will help open doors for exploring foreign markets.
The local car manufacturers including the Indus Motors Company are the platinum sponsor for Pakistan Auto Parts Show (PAPS 2011) aimed to provide a platform for local engineering firms to introduce their products.
The auto sector in Pakistan is committed to play its role in the development of engineering base of the country. So, sponsoring ‘PAPS 2011’ is a step in this direction, which will showcase the achievements of Pakistan auto industry.
http://nation.com.pk/pakistan-news-newspaper-daily-english-online/Business/24-Oct-2011/Pakistan-Auto-Parts-Show-opens-today
Here are some excerpts from a Bloomberg report on increasing auto sales and profits at Indus Motors in Pakistan:
Car sales in Pakistan increased 26 percent to 38,065 units in the quarter ended Sept. 30 from a year earlier, the Pakistan Automotive Manufacturers Association said Oct. 10. Indus sold 12,820 cars in the period, rising from 11,792 a year earlier, according to the association.
-------------
Oct. 25 (Bloomberg) -- Indus Motor Co., Toyota Motor Corp.’s affiliate in Pakistan, posted a 62 percent gain in first-quarter profit as rising incomes boosted sales.
Net income climbed to 937.5 million rupees ($11 million), or 11.93 rupees a share, in the three months ended Sept. 30, from 577 million rupees, or 7.35 rupees, a year earlier, the Karachi-based company said in a filing today. Sales gained 20 percent to 17.1 billion rupees.
Sales of the Cuore, Corolla, and Hilux models assembled by Indus increased more than 9 percent during the three months, according to Shahbaz Ashraf, an analyst at Arif Habib Ltd. Remittances to Pakistan gained 25 percent to $3.3 billion in the period, the nation’s central bank said Oct. 10.
“Rising remittances and farm incomes helped pushed sales for the company,” Ashraf, who has a “buy” recommendation on the stock, said by telephone from Karachi before the company’s announcement.
Indus, Pakistan’s second-largest carmaker, didn’t provide reasons for the profit increase in its filing.
Shares of Indus climbed 2.5 percent to 199 rupees as of 1:24 p.m. on the Karachi Stock Exchange, paring the stock’s decline this year to 21 percent.
Higher crop prices boosted farmers’ incomes in Pakistan by 342 billion rupees in the 12 months through June 30, more than the annual gain of 329 billion rupees in the preceding eight years, according to an economic survey published by the Ministry of Finance.
http://www.businessweek.com/news/2011-10-25/pakistan-s-indus-posts-62-profit-gain-as-sales-rise.html
Here's a report on Pakistan starting to export rickshaws:
Lahore: After exporting the motorcycles now Pakistan is ready to export CNG rickshaws to eight countries.
Chief executive, Sazgar engineering company, Mian Asad Hameed said that in the phase they were exporting around 150 rickshaws to eight countries and will increase the numbers gradually.
“We have delivered 22 rickshaws to Nigeria whereas we have received order for 40 rickshaw from Egypt,” he added.
He further said, “we are reviewing the possibility of export the vehicle to Srilanka and Indonesia.”
It is to be mentioned here that due to the prolonged outbreaks in Pakistan, industry faces severe crisis but this step would have positive impact on exports.
http://www.thenewstribe.com/2011/10/15/pakistan-all-set-export-rickshaws-to-8-countries/#.TqbmdtSXOSo
Here's a Pakistan Today report on motorcycle manufacturing in Pakistan:
Karachi - To effectively cope with domestic market of over 1.5 million units and after successful launch of their products in global markets, the local motorcycle producers are now planning a further investment of $100-150 million in their existing units.
The motorcycle industry analysts have pointed out that despite numerous hiccups faced by the economy in recent years, growth in motorcycle production has been robust at 15 per cent. “A decade back, the total motorcycle production in Pakistan was around 100,000 units, now the largest player alone is rolling out half a million units while total production of two wheelers has crossed 1.5 million. They said that the encouraging aspect in this regard is that industry is on the path to sustained growth. The local demand for motorcycles is likely to exceed 2 million units within a year or two,” they added.
“The global response to our quality motorcycles indicate a sustained and healthy growth in exports as well” they opined, adding that in fact, the industry experts are seeing themselves as the largest exporters in the engineering sector. A sustained growth is only possible due to regular investment and up-gradation of technology in the motorcycle industry. “The growth we see in motorcycle production would not have been possible without investment”, they added.
In this regard, Fahad Iqbal CEO, HKF Engineering, makers of Ravi motorcycles said that the industry now has to fulfill the growing demand in both domestic and global markets and for this, it needs to invest over $100 million in the next couple of years to keep abreast with market needs and demands. He said that all the motorbike producers having production of 50,000 units or above are now planning to expand their capacities to cope up with the market demands.
“There are almost a dozen players that have achieved this production level” he said, adding that even if each of them invests $10-15 million, the total investment would cross $150 million. These units have been regularly making investments to increase their market share but now they have reached a level where they have to invest in high-tech parts to ensure that instead of having 90 per cent local components, Pakistani bikes are produced by 100 per cent local parts, he added.
Market analysts urged that in such an encouraging situation, the government should refrain from taking steps that might jeopardise this investment. He said that an investment of $150 million by local players without any government concession is better than vying for similar investment over a period of 10 years from a foreign company. The current players, from Italy, China and Japan, are also in various stages of developing new models in the 100-150 cc range with the latest technology, he said. However, he added, they were not offered any relief even on imports of the environmentally friendly Euro 2 components, which have already been introduced in local bike production.
“Capacities exist in the country in areas like sheet metal parts and there is a huge investment need in areas such as die casting for parts like crank cases and crank covers, electronic parts such as CDI units, engine parts like ACG, clutch, pistons, shock absorbers (cushions), plastic parts such as emblems” said Arshad Awan CEO General Engineering and added that even capacity enhancement and thus investment will be needed in low-tech parts like head lights, tail lights etc.
http://www.pakistantoday.com.pk/2011/08/bike-manufacturers-plan-heavy-investment/
Pakistan auto sales up 24% in October, reports Daily Times:
KARACHI: Pakistan Automotive Manufacturers Association (PAMA) has released local automobile industry’s sales and production numbers for the month of October 2011. As per data, auto sales of the industry witnessed a substantial growth of 24 percent year to year (YoY) to 58,576 units in four months of fiscal year 2012 (FY12) as against the sales of 47,143 units in the corresponding period last year.
The main reason behind this substantial volumetric growth seems to be incentive given by the government to local auto manufacturers in terms of removal of Special Excise Duty (SED) of 2.5 percent on imported and manufactured vehicles coupled with reduction in General Sales Tax (GST) from 17 percent to 16 percent in addition to the low base effect. Pak Suzuki Motor Company Limited (PSMC) witnessed a 38 percent YoY growth to 34,877 units in 4M FY12 as against the sales of 25,279 units in same period last year.
Highest growth was observed in the sales of Suzuki Swift of 140 percent YoY to 2,328 units as against 969 units in the same period last year.
Liana under the domain of 1300cc and above segment also witnessed a handsome 37 percent YoY jump in its sales to 168 units in comparison of 123 units in the same period last year.
Ravi, the pickup, experienced a massive 23 percent growth to 5,722 units versus 4,665 units same period last year. Indus Motor Company Limited (INDU) witnessed a 7 percent YoY growth in sales to 17,806 units in 4M FY12 as against 16,622 units in same period last year. Hilux, under pickup segment led the growth in sales of the company with a gigantic 135 percent YoY to 1,099 units as against 647 units in the same period last year.
Toyota Corolla posted upsurge in sales by 6 percent YoY to 15,175 units as against 14,622 units in the same period last year. Cuore remained as the only segment of the company, whose sales experienced a decline of 19 percent YoY to 1,532 as against sales of 1,893 units in the same period last year. Honda Atlas Cars Pakistan Limited (HCAR) also showed a handsome growth in its sales of 14 percent YoY to 5,893 units in 4M FY12 as against the sales of 5,172 units in 4M FY11.
The main reason behind growth was low base effect. The City, the most liked segment of consumers post 20 percent YoY growth to 3,647 units as against sales 3,041 units in same period last year.
Civic another product of the company in 1300CC and above segment posted a modest rise of 5 percent YoY to 2,246 units in comparison of 2,131 in corresponding period of last year.
As far as the market share is concerned, PSMC leads the market with 60 percent market share followed by IMC and HCAR with 30 percent and 10 percent market share in 4M FY12.
http://www.dailytimes.com.pk/default.asp?page=2011\11\15\story_15-11-2011_pg5_2
India car prices rising as Indian rupee hits record lows, reports Wall Street Journal:
NEW DELHI – Several auto makers in India have decided to increase their vehicle prices in January due to rising raw material costs and a fall in the local currency’s value, which has made imports of parts more expensive.
The local units of Hyundai Motor Co., General Motors Co., Ford Motor Co. and Toyota Motor Corp. will increase vehicle prices on Jan. 1. Suzuki Motor Corp’s unit already increased prices of its diesel models last month.
The Indian rupee is the worst-performing Asian currency this year, with the U.S. dollar rising nearly 16% against the local unit. Auto makers, especially the local units of foreign companies, import large amounts of parts and the rupee’s weakness has driven up their costs.
They have also been hit by higher prices of key raw materials such as steel and aluminum.
Raising vehicle prices could further damp demand for vehicles, which has remained weak since June due to rising fuel costs and higher interest rates on loans.
Hyundai Motor India Ltd.’s director of sales and marketing, Arvind Saxena, said factors such as inflation and the rupee’s depreciation have “compelled us to look at a price increase.”
The company will increase the prices of all its vehicles by 1.5%-2.0%.
Maruti Suzuki India Ltd. raised prices of the diesel variants of four models by up to 10,000 rupees ($195), and it will consider a similar increase for gasoline-powered vehicles after December as an appreciation in the Japanese yen has made parts imports expensive, India’s largest car maker said on Dec. 1.
The company expects its operating profit margin to shrink 1.0 percentage point during October-March due to the currency effect.
Ford India will raise prices of all vehicles by up to 3%, while General Motors India will increase prices of most models by 1%-2%.
P. Balendran, vice president for corporate affairs at GM India, said it will increase the price of the diesel variant of its Beat small car by 15,000 rupees as it is currently being sold at introductory rates.
Toyota Kirloskar Motor Pvt. Ltd. also said it will lift prices by up to 3%.
Honda Siel Cars India Ltd., however, said it isn’t considering raising prices right now. “Our immediate priority is to make sufficient cars to meet demand,” said Jnaneswar Sen, senior vice president of marketing and sales.
The company has been forced to cut production due to a shortage of parts from Thailand following heavy floods there.
A Tata Motors Ltd. spokesman refused to comment, while executives at Mahindra & Mahindra Ltd. couldn’t be contacted.
http://blogs.wsj.com/drivers-seat/2011/12/07/car-prices-to-rise-in-india/
German tuck maker MAN setting up manufacturing in Pakistan, according to Express Tribune:
To explore new business avenues in the agricultural sector, German farm minister will arrive in Pakistan in a couple of months while a German auto giant is making huge investment by establishing a manufacturing plant in Pakistan, says German Embassy’s Commercial Section Head Samy Saddi.
Speaking at the Lahore Chamber of Commerce and Industry (LCCI) on Wednesday, Saddi said German auto giant MAN is putting up a truck and bus manufacturing plant which would not only create a large number of job opportunities but would also send positive signal to investors in other developed countries.
The diplomat said other German companies were also planning to make investment in alternative energy to help Pakistan overcome the energy crisis.
Saddi spoke about measures being taken by the German government to strengthen bilateral economic relations and said the upcoming visit of agricultural minister was very much part of these efforts.
LCCI President Irfan Qaiser Sheikh said continuous fall in bilateral trade called for appropriate sector-specific, result-oriented measures by both sides as the existing trade volume of $1.9 billion did not correspond with the great potential the two countries had.
http://tribune.com.pk/story/340386/german-minister-to-visit-pakistan/
Here's a Japanese report on auto industry in Bangladesh:
TOKYO (Kyodo) -- Local companies in Bangladesh are aggressively diversifying into heavy machinery industries, offering a new window of opportunity for Japanese manufacturers in a promising Asian market with a population of some 160 million.
Topping the list of such firms is the Dhaka-based home electronics maker Walton High-Tech Industries Ltd., which is planning automobile production. The company, which started production in 2006 as the first domestic electronics manufacturer, said it hopes to begin making cars at its new plant next year.
Walton executives say they want to put three or four passenger car models on the market in the near future, possibly by tying up with some Japanese companies and gaining their technical support.
Walton is among the local companies rapidly expanding and growing into major exporters in Bangladesh, where the textile business has been the main industry and imported products have commanded large shares of the domestic market.
While grabbing a large market share in the domestic home appliance market with its low-priced products, Walton has expanded into motorcycle production.
Bangladesh has been seeing annual economic growth of around 6 percent in recent years and its government is seeking development of industrial clusters by setting up special economic zones.
Hoping to beat foreign rivals in establishing a presence in the promising market, a Japanese economic delegation led by the government-backed Japan External Trade Organization, known as JETRO, visited Bangladesh in February. Officials from about 40 Japanese companies including electronics and auto parts makers took part in the program, reflecting Japanese firms' growing interest in the country's cheap labor and economic growth.
Fast Retailing Co., which operates Uniqlo casual clothing stores in Japan and in some major cities abroad, is among the Japanese companies already operating in Bangladesh.
Some of the officials who visited the country cited concerns about lagging infrastructure development, but voiced hope for business potentials arising from gaining a foothold before more companies from around the world come into the market.
The head of JETRO's office in Bangladesh said the number of Japanese companies contacting the trade-promoting organization for information and advice about the Bangladesh market has doubled since around 2006.
Other rapidly growing industries in the country include shipbuilding. Propelled by technologies and business know-how brought by Bangladeshi-born engineers with overseas working experience, Western Marine Shipyard has been winning a series of orders from Europe and elsewhere for small vessels.
http://mdn.mainichi.jp/mdnnews/business/news/20120310p2g00m0bu043000c.html
Here's an ET report on potential GM investment in Pakistan:
The Adviser to Prime Minister on Industries Muhammad Basharat Raja said that talks were held with delegations of Korean Company and General Motors (GM) to motivate them to invest in Pakistan and he hopes for positive results.
Raja told the National Assembly that the government is considering giving more incentives for investment in car manufacturing in the country. He added that presently one hundred and fifty thousand cars are being manufactured in the country and fifty thousand are being imported annually which are not sufficient to meet requirements.
General Motors, the world’s largest automaker based on sales has brands like of Cadillac, Chevrolet, GMC, Opel and Vauxhall under its belt. In Pakistan, General Motors markets its products through Nexus Automotive Limited, the exclusive importer and progressive manufacturer of the automaker’s products in the country. Nexus started manufacturing Chevrolet Joy in Pakistan in December 2005 whereas other GM products sourced from the global GM network are also planned for introduction to the local market. Nexus uses idle capacity at the Ghandhara Nissan Limited plant at Port Qasim to assemble Chevrolets, under the GM contract assembly agreement.
The project estimated value is $15 million and GM-Chevrolet has provided full support to ensure that the local components and the car assembled here meet GM quality standards and customer expectations.
Auto sales in fiscal 2012 stood at 157,325 units according to the data released by the Pakistan Automotive Manufacturers Association. In terms of car sales, Pak Suzuki Motor Company is leading with 95,142 units followed by Indus Motor Company and Atlas Honda.
http://tribune.com.pk/story/408082/exploring-avenues-pakistan-seeks-to-attract-general-motors/
Here's a Daily Times report on motorcycle industry in Pakistan:
Pakistan motorcycle industry sector is vibrant, flourishing and exemplary, as it achieved 95 percent localisation through latest technology transfer, billions of rupees investment and hundreds of thousands of skilled workers.
The sector progressed tremendously so far due to consistent policy of the government, while it gave protection to local investors to expand its businesses locally as well as globally.
The sector is apparently standing on its feet as it is not only able to meet the local demand but also capable of exporting various models to various countries, resulting in becoming a strong foreign exchange earning arm of the country.
Motorcycle production in Pakistan has increased in past 12 years. It has increased from a mere 100,000 units at the start of the century to around 2.0 million this fiscal. No other industrial sector has shown high and sustained growth during the past one decade. In fact Pakistan has emerged as global leader in production of 70cc motorcycles. He said that now even new 125cc bikes are also being exported.
However the proposed abrupt change in policy has badly shaken the confidence of investors and local manufacturers, following Board of Investment (BoI) ill-conceived initiatives to incentivise a Japanese bike maker to re-enter the Pakistani market at zero rate.
The plan to allow a new investor to import all motorcycle parts at zero duty will be negation of the previous policies and will encourage all original equipment manufacturers (OEMs) to bypass vendors and parts made locally, a representative of OEM said. The U-turn of policies will be worrisome and against the interest of the country and future industrialisation, he added.
Pakistan needs foreign investment! However, the country should not be so desperate in attracting investment by catering to unit specific investment proposals so as to destroy its most vibrant sectors where existing domestic and foreign are already investing. Such a case is that of the motorcycle industry.
The projection of this bike maker as a new investor conveniently ignores the fact that the same brand was being produced and marketed for decades in Pakistan and was forced to wind up on failure to compete with either other brands especially the Chinese bikes. Industry experts are dismayed at the constant pursuance to grant special status to this OEM on its re-launch and even more so by insisting that a supposed, and highly misleading, $150 million investment figure will be made.
The local industry, based on the projection of increase in demand, has already embarked on capacity enhancement plans and by the end of current fiscal year will have invested around $100 million out of which a size able amount is already invested while plans for rest are already submitted.
The proposal given to the government reflects that the OEM’s investment is hardly a couple of million dollars in the initial years. The remainder is merely a commitment to reinvest the tax so saved in the form of exemptions granted, when all other motorcycle manufacturers have readily agreed to pay high duty on the import of parts that are not being produced in Pakistan.
Another surprising aspect in this regard is the government wants to allow the Japanese manufacturer to import parts from anywhere but most probably from China. The claim that the new investment would bring new technology is an eyewash as the existing players have all introduced latest Euro 2 engines into the market without any special incentive.
Current players are even willing to import hybrid and EFI based engine without special incentives.
http://www.dailytimes.com.pk/default.asp?page=2012\07\17\story_17-7-2012_pg5_12
Here's a Daily Times story on Honda launch of a new motorcycle:
KARACHI: Pakistan will be amongst top 5 countries producing and exporting high quality motorcycles in next few years, T Oyama senior Managing Director Honda Motor Company Japan said at the launch of new model ‘Pridor’.
With the hard work of associates, Atlas Honda today stands at the turning point from where the sales and production will touch the ever highest in the history of the country, he said.
It is encouraging after investing $35 million this year, Atlas Honda has increased its motorcycle production capacity to 750,000 vehicles annually keeping in mind the growing local demand, one of the largest motorcycle markets in the world and export potential to regional countries, he said. The leading motorcycle manufacturer is currently conducting a study for an expansion to 1 million units’ production capacity, which is estimated to cost around an additional $50 million. He said the seed of relationship sown by Atlas Group Pakistan’s Yusuf Shirazi and Suichiro of Honda Japan is today the oldest joint venture of Honda Motor Company anywhere in the world i.e Atlas Honda Ltd.
By launching yet another state of the art model Pridor, surpassing all available technologies in the country, Atlas Honda has also proven its commitment to Pakistan’s market, he said.
http://www.dailytimes.com.pk/default.asp?page=2012\11\04\story_4-11-2012_pg5_8
Here's PakistanToday report on Pakistan's motorcycle exports:
Lahore - The domestic Motorcycle Industry has registered a remarkable recovery during the four months ending July 2011 as it has started taking its roots in international markets and exported around 10,500 units to different countries during the four months. The sources at industry said that after a steep drop in exports of around 135 percent from a peak of $3.5 million in 2009-10, the high-quality and low-priced locally produced bikes have effectively checked imports. They commended the industry efforts as the exports have picked up appreciably during April-July 2011 to 10,500 units.
They confirmed that during the said period, the industry has exported in excess of 2,500 units per month which is against an average export of around 1,200 units per month last year. If the trend continues, Pakistan will easily be able to double its motorcycle exports this year.
Motorcycle exports stood at $786,310 and surged to $3.5 million in the next year on the strength of $50 per unit Research and Development facility provided by the Government of Pakistan. The facility was withdrawn in 2010-11 after which the exports nosedived by 135 percent to $1.34 million, they said.
“The decline in exports would have been much higher but the prudent marketing strategy adopted by large motorcycle players controlled it”, said Mr. Fahad Iqbal CEO, HKF Engineering, makers of Ravi motorcycles. He said that the exports of motorcycles averaged over 2,500 units during the last four months which is a good sign for the industry. This, he added, is double the monthly export of 1,200 units in 2009-10 when record exports were witnessed. He said that the trend is expected to continue and Pakistan will easily be able to double its motorcycle exports this year.
Last year exports experienced a steep decline after a major policy shift by the Government when the Research & Development (R&D) facility was withdrawn from the motorcycle industry. The experts from the industry said that this massive recovery by motorcycle exports is testament to the resilience of this sector. The progress this sector has made over the last ten years or so is a proof that Pakistani entrepreneurs can compete with the best in the world if consistent policies are in place. Exports from Pakistan are textile dependent for the most part. Motorcycle industry provides a viable option as the next emerging export from Pakistan. “The industry is aiming to export half a million units annually by the year 2016” one expert said. “In export markets success builds on itself, especially, in motorcycles where establishment of an after sale service network and that of a secondary market creates the ground for a successful brand. Growth in sales will multiply as brands get established”, he said.
Experts pleaded that the current policy regarding motorcycles should not be disturbed as with its huge forward and backward linkages, the motorcycle industry moves the wheel of the economy. High employment creation and technology transfers make it an ideal sector for a country like Pakistan.
Growth in this sector means that upstream businesses such as part making in industries like steel, rubber, electronics and plastics etc. also get a boost. Investment comes in and jobs are created in all these industries. Similarly, this industry pushes up investment and creates additional jobs in downstream avenues like motorcycle dealerships for new and old bikes, repair and maintenance workshops and spare-parts businesses. The multiplier effect of this industry is huge.
http://www.pakistantoday.com.pk/2011/09/13/news/profit/pakistan-aims-to-double-motorcycle-exports-by-next-year/
Here's an Automotive World story on Pakistan restricting used car imports:
With local policy aimed at making Pakistan a favourable trading country, rather than a manufacturing one, the significant inflow of used cars into Pakistan has, in the past, constricted the local automotive industry. This may be about to change, however, following a decision by the country’s Economic Coordination Committee (ECC).
The ECC has decided to reduce the age limit of used car imports into Pakistan to three years, from the previous limit of five years, according to The News International. This directive will come into effect on 15 December 2012.
The Economic Coordination Committee is a cabinet-level body responsible for final decisions pertaining to Pakistan’s economy. Set up under the Chairmanship of the country’s Central Finance Minister, the committee comprises ministers in charge of the country’s economic ministries.
This decision has drawn mixed reactions from the various automotive industry bodies in Pakistan. The Pakistan Automotive Manufacturers Association (PAMA) has welcomed this decision, as it favours local vehicle manufacturers. The association’s Chairman, Parvez Ghias, feels that this move is in the greater national interest.
The All Pakistan Motor Dealers Association (APMDA), on the other hand, has called this move unfair and unjust, as it is a setback to the import of used cars. Chairman HM Shahzad says this cut in age limit, along with the depreciation policy in force at present, will push the prices of cars significantly.
Earlier, Daily Times, citing industry experts, said the government lost nearly Pakistani Rs16.5bn (US$171.79m) due to the import of 55,000 vehicles. Around US$371m were reportedly spent on the import of used cars last year. According to Shahzad, though, this move to restrict import of used cars into Pakistan will result in a Pakistani Rs32bn loss to national exchequers
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The report stated that there were more than 100 vehicle assemblers in the country. These companies assemble cars, buses, trucks, two- and three-wheelers and tractors. The number of automotive parts manufacturers, however, totals approximately 1,700.
Japanese companies lead the list of vehicle assemblers in Pakistan, while local companies form the bulk of the country’s parts manufacturers. This is compounded by a weakness in terms of manufacturing systems and technology in the supply industry, which the report attributes to a lack of competition brought on by localisation requirements.
....
http://www.automotiveworld.com/articles/manufacturing-logistics/ecc-move-to-restrict-import-of-used-cars-brings-cheer-to-assemblers-in-pakistan/
Here's a Forbes piece on Millat tractors in Pakistan:
Almost a year after floods devastated Pakistan, swamping 5.8 million acres of farmland and displacing millions of people, Ashaq Malik, who grows cotton, sugarcane and wheat on 865 acres in Punjab province, has reason to feel optimistic. After nearly a third of his land was inundated, today he is seeing a strong harvest. "As soon as the water level fell down, we started reconstructing the houses and working on the fields," says Malik. "Today there is no problem with the crops."
Companies that service the agriculture sector are also thriving in the rebound, none more than Millat Tractors of Lahore, which also manufactures other farm gear. Last year Millat earned 2.3 billion rupees ($29 million) on sales of $263 million, a 40% increase from the previous year. In the first quarter of 2011 profits grew 52% from the same period a year earlier..
To buy his 150,000 shares, Ansari--then a 39-year-old general manager--sold a plot of land, liquidated his retirement funds and borrowed money from his father. "It was a lot of money to me back then," he says. "Today it's like a lottery coming your way. The value has increased many, many fold since then."
Today the public, including Millat's 1,600 employees, owns 42% of the company; management and kin 28%; and banks and other institutions the rest. Employees are prosperous because of stock dividends and their salaries. Most of Millat's employees pay income tax--a sign of affluence in Pakistan--and have their own cars.
..
http://www.forbes.com/global/2011/0912/best-under-a-billion-11-millat-tractors-pakistan-after-flood.html
Here's a Daily Times report on a new steel mill starting production in Karachi:
Pakistan’s largest steel producing mill in private sector Tuwairqi Steel Mills Limited (TSML) is ready for commercial production in the first week of January 2013.
It would cater not only the steel needs of the country but would be able to export value-added products to other countries.
The setting up of such a mega project would entice foreign investors in the country despite the fact that local investors are also shifting their entities abroad because of bad law and order situation and energy crisis.
TSML mega project over $350 million is mainly sponsored by Saudi Arabian-based Al-Tuwairqi Company (ISPC) and Posco of South Korea.
TSML Director Project Zaigham Adil Rizvi at a seminar on Monday said this state-of-the-art Direct Reduction route of Iron (DRI) making plant would be starting commercial production but financial crunch put the project so late.
Posco-South Korean steel giant have invested $16 million to make this mega project keep going.
A revolution of industrial growth is in the offing as TSML is ready for commercial production in coming January. It is Pakistan’s first private sector integrated environment-friendly steel manufacturing project.
TSML will serve as a catalyst for the industrial growth in the country as steel has basic and vital role in the economic development of any country.
He said DRI technology is the latest in the world and is being used in not only developed countries but also in our region like Iran and India, so consistent highly quality of product can be achieved through this state-of-the-art technology, he said adding that this technology is environment-friendly.
Rizvi divulged TSML’s DRI plant after commercial production, would not only meet country’s steel requirements but would also create job opportunities for technical and skilled labour force for local people.
He said his team along with Posco delegates has started searching raw material in Balochistan and hoped they would not spend huge foreign reserves in importing raw material rather they would use the local material.
He claimed country’s workforce, especially the youth was not only dedicated and committed but also hard work, so the future of Pakistan was very bright.
Pakistan’s largest steel capacity of 1.28 million tonnes per annum plant would not only cater country’s requirements but also provide job opportunities to skilled and unskilled people.
Other countries including Korea wanted to purchase total production of TSML but TSML management has decided in principal that we would prefer to distribute all our products within the country and in this regard we have selected Lahore-based Shajarpak Company, as our sole distributor.
Khawaja Usman of Shajarpak said currently Pakistan was depending on imports for the production of heavy mechanical structures and engineering goods but after producing high-quality steel at TSML plant, Pakistan would be able to manufacture such heavy equipment locally.
India is giving more importance to its industrial sector while concerned authorities in Pakistan are least bother in this regard.
He hoped raw material from Balochistan would help steel industry to sell its products on low price.
http://www.dailytimes.com.pk/default.asp?page=2012\12\18\story_18-12-2012_pg5_7
Here's a Nation report on Japanese investor interest in Pak auto sector:
Huge potential exists between Pakistan and Japan to further strengthen economic ties as Pakistan offers a big market for investment in different sectors and hoped that the Japanese companies would tap that potential.
These remarks were made by Mr.Hiroshi Oe, Ambassador of Japan to Pakistan while addressing business community at Islamabad Chamber of Commerce & Industry (ICCI). He said that major reasons that keep Japanese companies away from investing in Pakistan are security and energy supply.
The Ambassador said that he has been trying to provide Japanese companies with opportunities to clear their perception gap and turn their eyes to the opportunities that Pakistan possesses. He said that Key areas of trade and investment between Pakistan and Japan could be textile, surgical equipments, furniture and automobile industry. He said that many big Japanese auto-industries investors are seriously planning to shift their units to Pakistan from Thailand due to heavy floods.
In his welcome address, Zafar Bakhtawari, President ICCI said that Japan is third biggest and one of the trillion dollar economies of the world and is an important trading partner of Pakistan as well as a major donor. ...
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/islamabad/18-Dec-2012/japanese-auto-industry-investors-shifting-focus-to-pakistan-hiroshi-oe
Here's ET on cost difference in Indian and Pakistani cars:
In support of his claim, he said average cost of a Pakistani car (excluding taxes) is Rs750,000. An average Pakistani car uses 60% of local components and the value of such components is around Rs450,000. This is the amount that the parts makers lost on each imported car, he said.
Most people believe that locally assembled cars are much more expensive than vehicles manufactured in other countries, but this is a wrong perception, the industry representatives said while giving a comparison between prices of Pakistani cars and those manufactured in regional countries.
Pakistani cars are cheaper than most cars manufactured in India, Allawala claimed, adding 1,800cc Toyota Corolla is being sold in India for $16,334 (retail price excluding taxes) while the price of the same car in Pakistan is $13,253, lower by $3,081.
Including taxes, the retail price of Toyota Corolla in India is $26,744 while in Pakistan it is $19,781, a difference of $6,963.
Similarly, the retail price of 1,800cc Honda Civic in India he said was $19,216 (excluding all taxes) while the same car is being sold for $15,214 in Pakistan, a difference of $4,002, he said.
After including all taxes, the difference in prices of Honda Civic in Pakistan and India is $7,403. In India, Civic is being sold for $30,455 while it is available at $23,052 in Pakistan.
The automakers and vendors have underlined the need for revision in the import duty slabs, saying the old duty structures are favouring car importers.
In response to a question, PAMA Director General Abdul Waheed cautioned the consumers, who are opting for imported used cars, saying they were making a wrong decision.
“The buyers of used cars may spend less initially, but eventually they pay much more in terms of expensive maintenance and low resale value compared to a new car,” he said.
http://tribune.com.pk/story/478485/auto-assemblers-say-cannot-sustain-liberal-import-policy/
Pakistan Post Office to provide motorcycles to its staff, reports PakObserver:
Islamabad—Pakistan Post will provide motorcycles to its postmen to ensure timely delivery of mails and important parcels. In this regard a Memorandum of Understating (MoU) has signed between Pakistan Post and Bank of Khyber (BK).
Through the scheme, the employees of the Post have an option to choose each and any brand of motorcycle available in market as per their choice. Director General, Pakistan Post, Syed Ghulam Panjtan Rizvi said that the organization has earlier provided motorcycles to its staff officials to ensure provision of quality services and it will provide more motorcycles to its postmen”, he said.
http://pakobserver.net/detailnews.asp?id=192703
Here's a Nation report on GoP MOU with Twariqi and Posco:
In order to promote and closely collaborate on the development of steel and infrastructure industry in Pakistan, the joint venture of Al-Ittefaq Steel Products Company and POSCO, have signed a memorandum of understanding (MoU) with the government of Pakistan through the Ministry of Investment for the backward and forward integration of Tuwairqi Steel Mills Limited (TSML).
Forward integration would be a further value addition through a Melt Shop, producing world standard steel grades, while backward integration would be to the extent of exploring iron ore locally in Baluchistan, its beneficiation & pelletization as well. The estimated investment on these projects would be around US$900 million.
The MoU was signed by S. Anjum Bashir, Secretary, Ministry of Investment, Prime Minister Secretariat, Government of Pakistan and Zaigham Adil Rizvi, Director (Projects), TSML in the presence of Dr. Hilal Hussain Al-Tuwairqi, Chairman Al-Tuwairqi Holding and Joon Yang Chung, Chairman & CEO, POSCO of South Korea.
As per the MoU, GoP will facilitate TSML in using Pachinkoh Deposit (Nokkundi) and Dilband Deposit (Mastung) for the development of iron ore mine and utilization of such developed iron ore products as raw material for TSML’s DRI Plant and Pellet Plant in its 1st and 3rd phase respectively. GoP has also committed to facilitate TSML with 180 MW of electricity, 3,000 m3 of water per day and natural gas as per the additional quantity required for TSML’s upcoming projects.
Through the MoU, POSCO has also expressed its interest for exploring business opportunities with GoP in engineering, procurement and construction services in the fields of infrastructure and industrial, environmental, electric power and oil & gas facilities.
On this occasion, Dr. Hilal Hussain Al-Tuwairqi, Chairman Al-Tuwairqi Holding said that Al-Tuwairqi’s vision is to participate in the development of national economy, in order to have a long sustaining growth of Pakistan. “We are looking forward to create, for our younger generations, ample job opportunities to build a strong and prosperous nation, on the face of this plant. Al-Tuwairqi sees Pakistan as a land of opportunities and we are very clear in our perception that Pakistan as a country has to grow and we are determined to play an instrumental role in its development,” he remarked.
Mr. Joon Yang Chung, Chairman & CEO, POSCO said that POSCO is serving some of the most quality conscious markets in the world, and with its vision and expertise in the global steel industry spanning over 4 decades, POSCO is committed to transform TSML into a globally renowned company for quality steel making.
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/23-Jan-2013/tuwairqi-posco-to-expand-operations-in-pakistan
Here's a Dawn report on Yamaha investment in Pakistan:
Yamaha Motors will invest US$150 million in auto sector of Pakistan to produce two-wheelers in the country.
This was stated by Sumioks, Senior Executive Officer of Yamaha Motors Pakistan (YMPK) while addressing a press conference in Islamabad on Thursday.
He said that the company would start production of motorcycles with engine capacity of 100cc and above from 2015.
“We have already submitted the application for registration to Securities and Exchange Commission of Pakistan (SECP) and 18 months after getting approved from the SECP, the company would start its production,” Sumioks added.
He said that initially YMPK will produce 40,000 units, which will be gradually increased and after five years the production would reach 400,000 units per year.
He said that the company would have its own factory and office of 50 acres at Bin Qasim Industrial Park Karachi.
“We will have high ration of localisation in manufacturing starting from 25 per cent since the first day of commercial production up to 85 per cent in five years,” he added.
He said the investment will help in boosting economic activity, increasing foreign direct investment, creating job opportunities, developing human resources and broadening the base of parts supplier industry.
He said the investment will create nearly 2000 job opportunities directly and 25,000 indirectly.
He said the motorcycles will be fuel efficient and would have new technology with Euro-II & Euro-III compliance, which were are not yet manufactured in Pakistan.
On the occasion, Feroz Shah, honorary councilor of Board of Investment (BoI) in Japan said that after producing motorcycles, Pakistan would be able to export them.
“The annual production of motorcycle is around 1.8m in Pakistan but almost all domestic models, so export is negligible.
“This plant will bring opportunity not only for the export motorcycles but vendors will also be able to export their parts as well,” he added.
http://dawn.com/2013/02/28/yamaha-to-invest-150m-in-pakistan-auto-sector/
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