Indus Motor Company Limited (IMC), Pakistan’s leading automaker, unveiled four billion rupees investment plan to expand its annual production capacity in a bid to capitalize on the growing consumer demand.
Currently, IMC holds an annual production capacity of 54,800 units, which are sold under the brand name of Toyota. The planned capacity enhancement would bring the production to 75,000 vehicles a year.
IMC Chief Executive Officer Ali Asghar Jamali told media at its third auto workshop:
“Pakistan’s auto industry future looks very promising, I am hopeful that Pakistan will be producing 500,000 cars per year by 2022.”
The demand for local as well as used cars has exponentially been growing for the last three years due to overall improvement in the macroeconomic activities. Despite being a world’s biggest densely-populated country, Pakistan has, however, not seen rapid motorization. The country has only 16 cars per 1,000 people. By 2020 the ratio is likely to reach 20 cars per 1,000.
Industry experts are expecting a fast growth in car sales due to growing and young middle-class in the country. The experts said the country is the third largest growing economy in emerging market and it could benefit from the ongoing $57 billion worth of China-Pak Economic Corridor (CPEC) projects.
On premium (own money) and black marketing, Jamali said the government should impose Rs 100,000 as a levy per car if the first owner sells it within six months of the purchase. “This will eliminate the middleman and investors who create artificial shortage of cars in the market,” he added.
Car manufacturers said import of used cars poses the biggest threat to the local industry’s survival. “We purchase local parts of Rs 150 million on every working day, which becomes Rs 40 billion per year,” said IMC executive.
Pakistan imports more than 46,500 used cars in a year, around 15 percent of the total car sales of 283,000 units in 2016.
The industry leader said Chinese companies are establishing auto industry in Gwadar on a 400-acre land. International automotive brands, such as Renault-Nissan, Kia and Hyundai have also expressed their interest to invest in auto assembling in the country.
Chairman PAAPAM Mashood Ali Khan said the association’s members have started to invest in production expansion in view of increasing demand of vehicles in the country.
Complete Story: TheNews