Automotive industry in Pakistan

The automotive industry in Pakistan is the one of the fastest-growing industries of the country, accounting for 4% of Pakistan's GDP and employing a workforce of over 1.8 million people.[1] Currently, there are 3,200 automotive manufacturing plants in the country, with an investment of ₨92 billion (US$560 million) producing 1.8 million motorcycles and 200,000 vehicles annually. Its contribution to the national exchequer is nearly ₨50 billion (US$300 million). The sector, as a whole, provides employment to 3.5 million people and plays a pivotal role in promoting the growth of the vendor industry. Pakistan's auto market is considered among the smallest, but fastest-growing in Asia. Over 180,000 cars were sold in the fiscal year 2014–15, rising to 206,777 units fiscal year 2015–16.[2][3][4] At present, the auto market is dominated by Honda, Toyota and Suzuki. However, on 19 March 2016, Pakistan passed the "Auto Policy 2016-21", which offers tax incentives to new automakers to establish manufacturing plants in the country.[5][6] In response, Renault, Nissan, Proton Holdings, Kia, SsangYong, Volkswagen,[7] FAW[8] and Hyundai[9] have expressed interest in entering the Pakistani market.[2][10] NLC signed an agreement with Mercedes Benz for the manufacturing of Mercedes Actros trucks in Pakistan. Pakistan has not enforced any automotive safety standards or model upgrade policies. A few old models of vehicles including the Bolan and Ravi continue to be sold by Suzuki.[11]

Toyota Indus's Corolla is the most manufactured car in Pakistan. In 2017, 52,874 models were made.

History

See also: Industry of Pakistan

Early years (1950–1969)

Pakistan produced its first vehicle in 1953 at the National Motors plant in Karachi, according to the Ministry of Industries & Production. The plant was opened in conjunction with General Motors who arranged the facilities for the production of Vauxhall cars and Bedford trucks. Subsequently, buses, light trucks and cars would be assembled at the same plant. In the same year, Ford trucks partnered with Ali Automobiles where they introduced Ford Anglia, Ford pickups and the Ford Kombi. Exide Pakistan also began production of car batteries in 1953. Haroon Industries partnered with Dodge Motors in 1956.[12]

In 1961, Allwin Engineering introduced precision auto parts to the Pakistani auto market. In 1962, Lambretta partnered with Wazir Ali Engineering to begin production of the Lambretta TV200 scooter while Kandawala Industries introduced the CJ 5, CJ 6, CJ 7 series Jeep. In 1963, General Tyre Pakistan began production in Karachi while Hye Sons began production of Mack Trucks. In 1964, Rana Tractors began producing Massey Ferguson Tractors while the famous Vespa scooter and rickshaw were introduced by Raja Auto Cars. In 1965, Jaffer Industries and Mannoo Motors began operations.

Nationalisation (1970–1989)

The 1970s saw nationalization of many companies. In 1972, the Pakistan Automobile Corporation (PACO) was formed. Many companies were bought out or merged into others. Wazir Ali Engineering was renamed to Sindh Engineering, Ali Autos to Awami Autos, Haroon Industries to Republic Motors, Ghandara Motors to National Motors, Hye Sons to Mack Trucks, Kandawala Industries to Naya Daur Motors, Jaffer Industries to Trailer Development Corporation and Rana Tractors to Millat Tractors. Dawood Yamaha introduced Yamaha motorcycles in 1974 and in the same year Beta Engineering started producing diesel engines. In 1976, Suzuki Motor Cycles launched by Sindh Engineering. Saif Nadeem Kawasaki launched Kawasaki motorcycles in 1977 while Suzuki Jeep was manufactured by Naya Daur Motors.

In 1980, Awami Motors began manufactured Suzuki pickups while Sindh Engineering began producing Mazda Trucks. In 1981, Agriauto Industries introduced production of local auto parts while in 1982, Pak Suzuki began production of vehicles. In 1983, the Vendor Development & Technical Cell or VDTC was formed along with Al-Ghazi Tractors which was introduced by Fiat. In 1986, Hinopak Motors began as a joint venture between PACO, Al-Futtaim Group, Hino Motors & TTC. In 1987, Ghandhara Nissan began production of Nissan Diesel Trucks. In 1989, Pakistan Association of Auto Parts & Accessories Manufacturers began operation.

Deregulation (1990–2009)

The industry was highly regulated until the early 1990s. Following deregulation, the decade witnessed a huge boom in auto production, as nationalization was abandoned in favor of privatization. Japan acquired the 40% shares of Pak Suzuki in 1991. In 1993, the Indus Motors Company began production of Toyota Corollas. In 1994, the Pakistan Automotive Manufacturers Association formed, and Honda Atlas introduced manufacturing of the Honda Civic. In 1995, the Engineering Development Board inaugurated the PAP show.

From 2001 to 2007, small assemblers and many bike importers started assembling replicas of the Honda CD70 with Chinese collaboration and established there Association with Founder Chairman of Mr. Muhammad Sabir Shaikh, Association of Pakistan Motorcycle Assemblers APMA in 2002, after 2003 annual production of motorcycles kept increasing, with auto sales making records year after year, reaching a peak of 195,688 sales in 2007, during this period Afzal Motors began local assembly of Daewoo buses and trucks under license from Daewoo Bus, South Korea and Tata Daewoo, thanks to rising car financing up to 70–80% by banks and low interest rates coupled with rising rural purchases. From 2007 to 2009, the auto sector witnessed reduce sales amid high interest rates and yen appreciation against the rupee. In 2007, the automotive industry made up 2.8% of Pakistan's GDP and contributed 16% to the manufacturing sector. The 2000s also saw the introduction of dual fuel options to run both on petrol and CNG, which is more affordable and cheaper than petrol in the country.

Rapid growth (2010–present)

In 2010 the sales rebounded and began increasing again. The auto industry predicted a growing demand in Pakistan and invested over ₨20 billion (US$120 million) during this decade. Motorcycle production hit a record level in 2016–17, with 2.5 million units made. In 2015, the Auto Policy 2016-21 was introduced, to help lure new automakers, which has traditionally been dominated by Honda, Toyota and Suzuki. The auto industry remains the second-largest payer of indirect taxes after the petroleum industry in Pakistan. At present, there are 10 cars for every 1,000 people in Pakistan. This is one of the lowest ratios among emerging economies, which itself speaks of high potential of growth. Rising per capita income with changing demographic distribution and an anticipated influx of 30 to 40 million young people in the economically active workforce in the next decade will provide a stimulus to the industry to expand and grow.[13] Toyota started local assembly of its sedan Corolla. Similarly, United Motors started first Pakistani locally made car Ghandhara Nissan started production of Isuzu d-max in Pakistan.

Historical production by year

Automobiles

Historical production by year[14]

Year	Production
1994	61,000
1995	44,000
1996	78,419
1997	41,585
1998	43,519
1999	46,761
2000	39,117
2001	46,538
2002	48,579
2003	74,274
2004	112,550
2005	150,016
2006	189,639
2007	195,688
2008	186,064
2009	100,468
2010	137,415
2011	153,114
2012	175,184
2013	134,849
2014	148,746
2015	229,686
2016	274,536
2017	285,248
2018	342,575
2019	298,083

Motorcycles

Historical production by year[14]

Year	Production
1997	106,797
1998	92,978
1999	87,504
2000	86,959
2001	108,850
2002	120,627
2003	175,169
2004	303,383
2005	416,189
2006	520,124
2007	467,267
2008	660,593
2009	509,054
2010	736,861
2011	838,665
2012	828,576
2013	819,556
2014	771,507
2015	1,131,196
2016	1,362,096
2017	1,632,965
2018	1,931,340

Automotive manufacturers in Pakistan

See: List of automotive manufacturers in Pakistan

Automotive distributors in Pakistan

Various car and motorcycle companies are in various stages officially available & serviced in Pakistan.

See: List of automotive distributors in Pakistan

See also

• Electric vehicle industry in Pakistan

References

1. "Automotive Industry's Contribution to Pakistan [Infographic]".
2. "Automobile industry: Pakistan woos Renault-Nissan in investment push - The Express Tribune". The Express Tribune. 2016-05-07. Retrieved 2016-11-15.
3. "Car sales continue to shoot up - The Express Tribune". The Express Tribune. 2016-02-12. Retrieved 2016-11-15.
4. "Pakistan auto industry rides a high". Business Recorder. Retrieved 2016-11-15.
5. "Auto policy" (PDF). boi.gov.pk. Archived from the original (PDF) on 2017-03-17. Retrieved 2020-06-10.
6. "Auto policy approved, door wide open for new entrant - The Express Tribune". The Express Tribune. 2016-03-19. Retrieved 2016-11-15.
7. https://tribune.com.pk/story/1325911/volkswagen-set-launch-two-new-vehicles-pakistan/
8. "Heavy vehicles,Light vehicles,Chinese cars - Al Haj Faw motors Pakistan". Alhajfaw.com. Retrieved 2020-06-10.
9. "Are you a robot?". Bloomberg. Retrieved 2020-06-10.
10. "Audi AG expresses intent to assemble vehicles in Pakistan - The Express Tribune". The Express Tribune. 2016-11-15. Retrieved 2016-11-15.
11. "Auto industry enjoys unequaled run of success - The Express Tribune". The Express Tribune. 2016-02-08. Retrieved 2016-11-15.
12. "The economy and automobile industry of Pakistan". Ukessays.com. Retrieved 2020-06-10.
13. "Automark Magazine". www.automark.pk.
14. "Data" (PDF). www.pama.org.pk. Retrieved 2020-06-10.

External links

• Monthly Automark Magazine
• New Car Manufacturers in Pakistan
• Pakistan Automotive Manufacturers Association
• Cars & Models Currently Present & Selling in Pakistan

Templates