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Chinese truck manufacture interested in joining hands with Pakistani auto parts makers

Muhammed Hanif Memon
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Chinese truck manufacture interested in joining hands with Pakistani auto parts makers

By Hanif Memon

A high-profile Chinese delegation, representing Sinotruck Limited, visited the Pakistan Association of Auto Parts and Accessories Manufacturers’(PAAPAM) South Office here in Karachi to meet with senior members of the PAAPAM to discuss possible future ventures between the two countries for the manufacturing of trucks and their auto parts.The ten-member strong delegation was led by Mr. Wang from Sinotruck, while the delegation of PAAPAM was led by Chairman Mashood Ali Khan.  Members from Dysin Automobiles Pakistan and Paapam were also present.

Chairman and senior members of PAAPAM briefed their Chinese counterparts about the technologies, resources, and expertise of the Pakistani parts manufacturers in the field of trucks and the production of their auto parts. The Chinese members were also told about the growing auto industry of Pakistan, and how it is already heavily involved in the production of motorcycles, cars, buses, and trucks, and in the production and assembling of their auto parts. Wang  spoke of his desire and interest to utilize Pakistani expertise and labor in the production of auto parts for their trucks. Moreover, he said that they were interested in setting up a production plant for trucks in Pakistan and wants to be involved in successful businesses with Pakistan for years to come.

Members of PAAPAM invited the Chinese members to visit their plants, and to create a link where Pakistani members could visit their Chinese friends and learn from them about the latest technologies and utility of labor.

 

Vehicle registration in the six territories doesn’t match each other

Muhammed Hanif Memon
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Vehicle registration in the six territories doesn’t match each other

In four provinces, different rules for motorcycle registration and vehicle registration exist in federal territories, Islamabad and Azad Jammu Kashmir.

Punjab excels with other provinces where vehicle registration system is operated under the most advanced system.

The authorized dealers of vehicles are authorized to register vehicles or bikes at the time of sale. The dealers have been given permission to register or submit data of vehicle and the buyer in the Punjab Excise and Taxation Department.

In contrast, dealers in Karachi have been asked to make complete application form, CNIC copy of the applicant, authority/registration letter of the assembler in favor of the buyer and sales tax paid invoice by the dealer and by the assembler including pay order of registration charges in favor of motor registering authority of Karachi.

Due to these cumbersome and lengthy processes the buyer and the dealer will have to wait due to half day of Friday and Saturdays and Sundays being the holiday. When the dealers’ representatives or agents go to the MRA Karachi – the officials try to find loop holes and create unnecessary objections. After greasing the palm of the officials – all the problems are solved.

“The Chief Minister of Sindh Syed Murad Ali Shah should take notice over the corruption in MRA Karachi,” chairman Association of Pakistan Motorcycle Assemblers (APMA), Mohammad Sabir Sheikh said.

Contrary to this, he said the Punjab government has fixed the charges or fees on issuance of golden or famous numbers to the buyers of two and four wheelers such as 1111, 5555, 0786, 0110, 6666, 9999 etc.

In Sindh, Sabir claims that the officials take bribe for issuing golden or choice numbers. These officials are misusing their powers and the higher ups in the Sindh government are watching the situation from the sidelines.

If a bike is produced by Pak Suzuki Motor Company or by Atlas Honda Limited and this bike is invoiced in up country then MRA Karachi demands Rs 2,000 per bike (extra money) by saying that this invoice does not belong to Karachi district.

The tax officials are cashing on soaring demand of choice or golden number from the buyers. Bike owners like to have a special or unique numbers in which golden number or number of equal digits is gaining popularity.

The opportunity of getting golden number has become a source of handsome earning for the brokers of excise and taxation department and the officials of the government departments. These officials and brokers are taking heavy bribes from the impatient customers.

Sources said numbers like 5555 and 1111 are being allotted after paying bribe of Rs 5,000 to Rs 10,000 to the brokers and officials.

They said the game of money making has been in vogue as the government has not fixed any fees or amount for obtaining golden or choice numbers, sources said adding that the brokers and excise officials are taking full advantage of non availability of any official fee or amount of choice numbers.

In the last one month some 30,000 register numbers were given to the bike buyers. There are 10,000 numbers in one series of bike and other vehicles in which nine golden identical numbers exist like 6666, 9999 etc which are being allotted to the buyers by the dealers in connivance with the excise and taxation officials, sources added.

In Karachi around 1,400 bikes are being registered daily in the government department which means that in the 22 days some 36 golden or choice numbers were issued after exchange of heavy bribe between the dealers, buyers and the government officials, sources said.

The golden or choice numbers for religious buyers are different like 0786, 0110 etc which are also in high demand as compared to other golden numbers.

Numbers in pairs like 6262-5252 are also famous on which bribe rate hovers between Rs 1,000-1,500 per buyer.

Sabir said the Sindh government in the current fiscal year has increased the fee for duplicate registration book to Rs 2,000 from Rs 500.

He said the CM Sindh Syed Murad Ali Shah should see the possibility by officially fixing a reasonable fee or amount for golden or choice numbers so that the practice of charging illegal fee should be curbed. He said fixing a fee or amount below the bribe rate would definitely bring additional revenues to the government’s coffers besides controlling the menace of bribe.

He said the excise and taxation department was already getting more revenues due to surging registration of bikes and other vehicles. Fixing a reasonable fee for choice and golden numbers would further boost government’s earning.

Some leading brands are enjoying boom period of bike sales in which Atlas Honda Limited has beaten all the assemblers by achieving record sale of 960,105 units in the country during 2016-2017 as compared to 811,034 in 2015-2016.

A Chinese bike assembler – United Motorcycle, has emerged as the second highest bike sellers, posting record sale of 326,298 units in 2016-2017 as compared to 262,773 units while Road Prince has sold 207,244 units versus 167,241 units in 2015-2016.

The new fiscal year will bring new sales laurels for Atlas Honda which aims to sell more bikes than 2016-2017 for which it has already raised its combined plant capacity to 1.3 million units per year.

Bike demand has emerged due to improving law and order situation in the country especially in Karachi and improving farm income.

According to the annual report of Atlas Honda Limited 2017, enhanced economic fundamentals, better security situation and increasing real incomes reflected in rising demand of consumers’ durables including two-wheelers. A strong consumer appetite for bikes in both urban and rural areas was the major growth driver. Low petrol prices, higher trend of urbanization and demographic shift to youth also supported the demand of two-wheelers.

Sabir Sheikh said another trend among young generation is the usage of heavy bikes which are being imported. Bike assemblers are also importing little quantity of heavy bikes. As a result the import bill of bike imports went up 1.5pc to three million dollars in 2016-2017 from $2.945 million in 2015-2016.

Local Chinese bike assemblers have started introducing heavy bikes for the last one and half years though they look like toys and cannot match with the quality of Japanese products.

Omega Industries, the assembler of Road Prince motorcycle bikes, had introduced RX-130, 250cc recently with a price tag of Rs 400,000.

Super Power had unveiled 200cc bike at a price of Rs 200,000 followed by ZXMCO 250cc price of 2,45,00 and Ravi 150cc etc.

Sabir Sheikh said a new trend is emerging of rolling out over 125cc heavy bikes based on majority of imported parts but so far the consumers have shown lukewarm response due to high prices. The assemblers will have to improve their quality to match with Honda 150cc which was recently introduced at an attractive price. Honda 150cc would give tough time to the Chinese competitors because of its quality and price, APMA chief added.

“One thing has proven so far that these 150-250cc bikes are not for low and middle income group people. A well off young generation can afford these bikes,” he said.

To encourage competition among assemblers and bringing down price of heavy bikes, Sabir said the government needs to simplify the procedure of obtaining permission for parts imports which is currently lengthy and cumbersome.

People are taking time to adjust with heavy bikes. They had shown tremendous response to Suzuki 150cc but later shifted to other brands. Honda 150cc may prove a game changer in the heavy bike category, he said.

Yamaha came with a fanfare but it is now struggling for its survival. The company closes its financial year 2016-2017 on a depressing note with sale of 13,282 units as compared 16,109 units in 2015-2016.

Pak Suzuki bikes slightly came out from the red by recording slight jump in sales to 18,478 units in 2016-2017 from 17,456 units in 2015-2016.

This exclusive article on auto sector of Pakistan, published in Monthly AutoMark Magazine’s August-2017 printed edition.

ZhongTong intercity Bus launched in Pakistan by Dysin Automobiles Limited

Muhammed Hanif Memon
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ZhongTong intercity Bus launched in Pakistan by Dysin Automobiles Limited

The Future of buses in Pakistan

Dysin Automobiles Limited, one of the most rapidly growing automotive companies in Pakistan, has launched the Zhongtong Intercity Bus in a glittering ceremony held in Lahore.  Dysin Automobiles Limited is renowned for its value added services and successful representation of Sino Trucks in Pakistan.

The ceremony was attended by CEO Dysin Automobiles Imran Malik, COO Mir Asad Waseem, Director Sardar Jawaid Durrani, Head of Sales & Marketing Ahmed Sana Zaidi, Project Manager Rehan Raheem Bhatti, and Marketing Manager Muhammad Umar Irshad. The Chief Guest was SardarQaiser Abbas Khan Magsi, Chairman Standing Committee Transport, Punjab.

The Zhong Tong Bus has been tested extensively globally to conform to the benchmark of quality and performance of other such buses being used across the globe. Dysin Automobiles has selected two variants, Elegance and Navigator, for the Pakistani market.

The bus is a symbol of high quality, performance, style, elegance, comfort, and financial value for local business partners and also for the users. Integrated with craftsmanship of Chinese excellence and leverage of European technology, the bus is an ideal solution in every aspect with low cost of ownership. Dysin Automobile hopes that the product will prove to become an indispensable asset for transporters.

Zhongtong Bus is ranked in the top three best-selling buses manufactured in China, with more than 25,000 unit sales annually. The bus is manufactured in a state-of-the-art assembling facility in Jinan, with Zhongtong being a symbol of technology, performance, innovation, and economic value within China and overseas markets.

 

FAW Motors launch V2 – A locally assembled hatchback car in Pakistan

Muhammed Hanif Memon
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FAW Motors launch V2 – A locally assembled hatchback car in Pakistan

FAW announced the launch of local assembly of their passenger car, FAW V2, in an event held on 12th August, 2017 in Karachi

FAW V2 is the first Chinese passenger car to be assembled in Pakistan. The Managing Director of the company, Mr. Bilal Afridi hosted the event, which was attended by all of their nationwide dealers and vendors.

FAW is the fastest growing Chinese automotive company formed in collaboration with Al-Haj in 2007. The 50,000-sq. m factory of 600+ employees is built on 105,000-sq. m land with a capacity of 10,000 units pa/single shift.

Mr. Bilal Afridi mentioned in his speech about the initial investment of 2.5 billion Rupees made to set up the company and a further investment of 1.3 billion Rupees for an improved local assembly setup and ED Paint technology in their cars.

He talked about the commitment of his company to continuous advancement in technology, premium 3S customer service and dealership network, in all major cities of Pakistan in addition to 3 years/60,000km warranty.

FAW claims that their local assembly will help them serve its customers better and give them quality assurance of the vehicles. The company aims to increase their production to 15,000 units per annum by year 2020 and introduce new models in Pakistan.

The V2 hatchback with 1300cc engine is currently being imported as Completely Built Unit (CBU). Introduced in our market in 2014, the V2 has gained a satisfactory reputation among the consumers and the demand is steadily on the rise.

The company started its operation here in Pakistan with 7 acres land and now is proud to have an operating land of 27 acres. This shows the commitment of the company & is definitely not among those who come & leave.

“Our vehicles bring another category in the market where we provide luxury features of a car at affordable prices. We are now being recognized for quality, economy and technological brilliance. Our products ranging from heavy vehicles to light vehicles cater every need of our commercial and domestic sector and we are rapidly gaining people’s trust.”

He further stated: “As a result of good response and with encouragement of our customers, we have further invested rupees 1.3 billion in new assembling process and ED paint technology to improve our V2 with local assembly right here in Pakistan.”

A locally assembled V2 would likely mean lower prices compared to the CBU while a lower displacement engine would also ease out buyers in taxation & registration costs.  V2 is probably the most fuel efficient 1.3L car available on Pakistani roads. The current in-city average is about 15-16km, and on highways it reaches 18km in a liter. By end of 2017, Al-Haj FAW expects to produce 500 V2 units a month. We Have further plans to export our right hand drive cars in China and other international markets.

About Al-Haj:

The very first ‘Al-Haj’ companies was launched in 1960 by Late Haji Sakhi Gul at Jumrud Khyber Agency in District Peshawar, with their initial business in trading of Tires, Textiles, electronic goods, Logistics & Leasing. Now company expands its business to Assembling of HCV, LCV & Passenger Vehicles, Import of Passenger vehicles, Real Estate, Oil Exploration & Al-Haj Foundry. The Group is in the process of continuous growth under the able guidance of Mr. Haji Shah Jee Gul Afridi, the Chairman of the Group.

About FAW:

FAW “First Automobile Works” was founded in Changchun on 9 th June 1953 by Chairman Mao Zedong. In 1992, the name “First Automobile Works” was changed to “China FAW Group Corporation”. FAW Group is a global leader in vehicle manufacturing industry with more than 60 year history of innovation. FAW has a state-of-the-art government-certified engineering development and test centre. – PR

Automark Magazine July 2017

Muhammed Hanif Memon
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Automark Magazine July 2017

Florida No-Fault Auto Insurance Explained

Muhammed Hanif Memon
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Florida No-Fault Auto Insurance Explained

Florida No-Fault Auto Insurance Explained

In 1972, Florida responded to what was seen as a crisis in insurance rates and excessive lawsuits by becoming one of the first states to adopt a new form of automobile insurance. The system, known as no-fault insurance or personal injury protection (PIP), was a trade-off: While the victims of car crashes would be guaranteed coverage of medical expenses, they would also lose their right to sue for other damages.

While many view the no-fault system as a success, many others see it as a failure. To understand how the system should be evaluated, it’s important to know how it actually works—and why. Some aspects of the no-fault system are obvious and work just like other insurance plans, but other parts of it can be counterintuitive and require explanation.

 

How Does No-Fault Work?

In a no-fault system, all drivers are required to carry a minimum amount of insurance coverage. In Florida, the coverage requirement includes $10,000 each for bodily injury liability, property damage liability, and PIP.

When a driver is involved in a crash, these amounts become available to pay for medical expenses and repairs and will be paid automatically; determining which driver caused the crash and how much responsibility each driver bears is not necessary.

With traditional insurance, damage claim amounts are paid by the insurance company of the at-fault driver, often only after a settlement or lawsuit. With no-fault, however, it is actually the injured driver’s own insurance company that pays him; each driver is actually insuring himself against the possibility of being injured in a crash by his or her own actions or those of another. The only way a no-fault system can really work is by taking advantage of these two ideas: All drivers have the required insurance, and all drivers are, in effect, self-insured.

 

The Pros

No-fault insurance brings concrete benefits. In Florida, these benefits include the following:

  • Victims can recover up to $10,000 in medical benefits almost immediately after a crash injury.
  • If an injury results in temporary or permanent disability, lost wages and income are covered.
  • Victims don’t have to go to court to receive benefits.
  • If someone is killed in a crash, a death benefit is paid to the estate or survivors.
  • Drivers in less serious crashes know they won’t be sued.

 

The Cons

No-fault insurance isn’t perfect, however. In Florida, critics often cite these limitations:

  • Only 80 percent of medical expenses are covered.
  • Only 60 percent of lost wages and income are covered if an injury leaves the victim unable to work—temporarily or permanently.
  • The death benefit is only $5,000.
  • Non-drivers, such as bicyclists and pedestrians, will not usually have no-fault auto insurance and have no protection when they are injured in a crash. (Remember: The victim’s own insurance company pays.)
  • Coverage can cost slightly more. In Florida, the amount might average between $9 and $81 more per year, based on various factors.
  • Victims can’t sue for non-monetary damages like emotional distress.

 

The Future of No-Fault in Florida

No-fault insurance was implemented in at least 24 states in the early 1970s, and 12 still have it today. When no-fault has been declared a failure and repealed, it’s usually been because coverage limits have been too low to provide adequate protection. When coverage is higher, states usually keep it.

For example, in Michigan, which has the highest no-fault limits of any state, voters have repeatedly chosen to keep the system, despite having the most expensive insurance rates in the nation. They seem to understand that, even though it’s costing them, the alternative would be worse.

Most years, there’s talk of repealing no-fault in Florida. In 2017, bills that would have done away with no-fault insurance were introduced in both houses of the legislature. While it at first appeared that the bills might become law, they eventually died in committee at the end of the session.

If you need to know more about no-fault auto insurance, a personal injury lawyer in Florida can help you. Lavent Law practices automobile accident law in South Florida and can help you understand the system.

Pak Suzuki decreased the Price of Heavy Bike Inazuma GW250?

Muhammed Hanif Memon
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Pak Suzuki decreased the Price of Heavy Bike Inazuma GW250?

Though Pak Suzuki has not released any information on why the price of Inazuma has been decreased, the speculations are being made on social media and among the stakeholders including dealers, customers and other experts of the industry about this sudden decrease in the price of Inazuma 250cc bike.

Listed below could be the three major reasons for such a significant decline in the price of Inazuma by Pak Suzuki:

  • Pak Suzuki is looking to make bigger strides into the heavy bikes market of Pakistan by offering one of a kind, 250cc bike in Inazuma at a low price. In this way, the company is trying to win the trust of customers so that it can establish a strong customerbase before Honda launches a similar bike in the market. According to market sources, Honda is also planning to launch its 250cc heavy bike in the Pakistan soon.
  • Another reason could be the fact that Pak Suzuki is looking to acquire maximum orders for heavy bikes from different provincial governmentsand the federal government. The increase in the demand for heavy bikes at Government level has cut down the cost on the assembly of heavy bikes significantly, which is why Pak Suzuki has possibly decreased the price of Inazuma.
  • Another big reason is the competition faced by Pak Suzuki from few Chinese brands that has already given a wakeup call to Suzuki by getting a positive response from customers in the Pakistan market.

As per market sources, Pak Suzuki could  manage to sell almost 100 units of its heavy bike Inazuma in  year, which has also made the company think of ways to promote the sales of its heavy bike and decreasing the price of Inazuma is a logical step in that direction. Fans of Suzuki Inazuma and the interested buyers can expect a major decrease in the price of this heavy bike.

According to a letter for All Pak Suzuki authorized dealers from Pak Suzuki for the announcement of price reduction in Suzuki Inazuma GW250 leaked on social media, the dealership price of the heavy bike Inazuma GW250 has been decreased from PKR 681,000 to PKR 599,000. Dealership price is mostly lower than the market price of a vehicle and customers are usually not made aware of the difference between the market price and dealership price. But now, as the new dealership price has been leaked on social media, customer may demand the heavy bike to be sold in the market at the same price that is announced for dealers without any additional charges.

Will the social media leak of the new dealership price benefit customers?

The heavy bike Inazuma was earlier available in the market at a price of PKR 725,000 which is now set to decrease considerably, especially after the leaked dealership price on social media. It has been speculated that after the social media leak of the press release, dealers will have to offer the bike in the market without earning any significant profit against the market price. The loss of dealers will have to be compensated by Pak Suzuki to retain the trust of its customers and maintain its reputation among dealerships in Pakistan. This will eventually benefit the customers who will expectedly experience a considerable decline in the market price of Inazuma.

The Suzuki GW250 is a 248CC entry-level standard motorcycle sold in Australia, Asia and Europe. It is called the Inazuma 250 in the EU and the GSR250 in Japan. Wikipedia

Seat height: 780 mm (30.7 in)

Oil capacity: 2.1 L (0.6 US gal)

Fuel capacity: 13.3 L (3.5 US gal)

Bore / stroke: 53.5 mm × 55.2 mm (2.1 in × 2.2 in)

Dimensions: L: 2,145 mm (84.4 in); W: 760 mm (29.9 in); H: 1,075 mm (42.3 in)

Weight: 170 kg (374.8 lb) (dry)

Engine: 248 cc (15.1 cu in), 4-stroke, inline-twin, liquid-cooled, SOHC

By: Syed Sarim Raza

NED students win ‘Breakthrough Award’ at Formula Student 2017

Muhammed Hanif Memon
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NED students win ‘Breakthrough Award’ at Formula Student 2017

A group of young engineering students from NED University of Engineering and Technology has won “Breakthrough Award” at Formula Student UK’s 30th competition at Silver stone.

Fusion NED, a student racing team representing NED University of Engineering and Technology, consisted of 16 students who paid their own expenses to take part in the competition which was attended by young engineers from 68 countries, run by the Institution of Mechanical Engineers – the world’s largest student motorsport event for student engineers to design, build and race single-seat racing cars.

NED’s Team Formula Fusion consisted of 16 engineering students, namely: Humza Yamin (team leader), Mujtaba Raza, Faisal Sattar. Saroosh Ahmed, Abdul Samad, Arham Ali, Ali Abdullah, Rahul, Ahmad Shafiq, Immad Naveed, Hasan Ishaque, Ahmed Velmi, Zeeshan, Moiz and Rameez.

The team toiled for two years with sleepless nights, dedicating all their time and money and even their earnings for the passionate goal of making a name for Pakistan on the international forum. The team built an outstanding formula student car that competed with 85 leading international engineering universities from 65 countries. The team secured “Breakthrough Award” which has been introduced for the very first time in this mega competition.

The young Pakistani engineering students not only managed to secure extensive appreciation from renowned judges of motor sports but also received appreciation momento of a BMW F1 aerodynamic part from F1 specialist William Toet.

The team participated in the coveted event for four days. Despite the hindrances and setbacks, the team persevered even though this was their first entry in the competition. In the end, the team made its mark at the prestigious Silverstone Circuit and received its Award surrounded by the chants of “Pakistan Zindabad”.

Speaking to media, the students said they had no help from anyone but they were determined to make it to the event to show that Pakistanis are innovative and talented and they are making advances in the field of technology. They said that dozens of Formula Student alumni have progressed to Formula 1 and hundreds more are now working at the world’s largest automotive firms. The students added they had to get loans from family members to import parts of the car but thanked Pakistan International Airlines (PIA) for helping to cargo the racing car for free to Britain.

Pakistani team’s car made it to the event after the start of the event because clearance at the taxation department was delayed for two days, but the students were able to demonstrate before the judges and international students how they had assembled and prepared the car in Karachi. The students shared that it was a joy for them to represent Pakistan at the world stage. They appealed to the government of Pakistan to help students who want to make it big at the international stage but lack resources.

Andrew Deakin, Chairman of Formula Student, said in a statement: “It’s brilliant to see so many teams from around the world applying for Formula Student 2017 – it shows that the competition remains one of the most important learning experiences for those aiming to combine their studies with exposure to a real world engineering project. Formula Student is a global competition and we want to continue to encourage brilliant young engineers from across the globe to improve their practical skills and get ready to play their part in the vibrant worldwide engineering community. The innovation demonstrated by these young engineers gets more impressive every time and I’m extremely excited to see what they have in store for us this year.”

Congratulations team NED Formula

 

Need to check fishy bike deals to safeguard consumers

Muhammed Hanif Memon
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Need to check fishy bike deals to safeguard consumers

After a gap of seven to eight years – a new game has started all over Pakistan in which customers are being asked to deposit Rs 25,500 only for 70cc Chinese bike of any brand. The buyers are assured by the selling companies that they will get the delivery of bike after one month.

The sellers ask bike buyers to arrange two more customers for depositing Rs 25,500 each before the delivery of first customer’s bike. If the buyers succeed in managing two more buyers then this deal is called a “matured deal” between the buyer and the seller. Surprisingly the two buyers are also being bound to arrange two more buyers separately.

According to a market study, famous brand of Chinese 70cc is available in the market at the rate of Rs 42,000 to Rs 44,000. On the contrary, infamous brands can be purchased at Rs 37,000 to Rs 40,000. These dealers are also selling Honda bikes for which the amount of advance payment is Rs 40,000.

It is hard to digest that how the companies are trying to sustain in the stiff competition and how they are ensuring delivery of bikes at Rs 25,500 to the buyers.

Market sources said these bike sellers are procuring two wheelers from the markets on original rates and they are handing over the bikes to the customers at discounted rates which do not click the mind of old market players.

Chairman Pakistan Tajir Itehad (PTI) and Association of Pakistan Motorcycle Assemblers (APMA), Mohammad Sabir Sheikh recalled that the people of Pakistan know very well about the history of Tawakal Group in the auto sector.

He said some of the units were closed due to default in repayment of bank loans. It is usual practice in Pakistan automobile industry to generate funds through advance booking of the vehicles.

Sources said as per media reports, everybody is aware of Rs 800 million fraud by two sons of Abdul Qadir Tawakkal Group/Naya Daur Motors under the name of Kia pride car. About 16,000 people lost their hard earner savings in this scam of 1994 by Naya daur motors.

The accused were involved in Kia Pride car scam along with their father in which more than 16,000 poor people were deprived of their hard earned cash through advance booking of the vehicle all over the country. After collecting more than Rs 800 million the accused failed to provide cars to their customers and fled to the US.

Sabir said has the government framed any rules for the new entrants under new Auto Policy which can safeguard the money of common men of the country.

They are offering cheap vehicles in the market to lure customers. They are unknown and do not have any financial worth in the markets. After taking heavy money from the customers there is no guarantee from them to ensure early deliveries of bikes or they may run away by collecting huge amount of customers.

Sabir said the government should allow new entrants to book vehicles in the range of 400-500 units and the State Bank should keep an eye on new entrants.

He said the State Bank should come out with a policy under which only selected number of vehicles are booked and released to the customers rather than taking heavy booking or failing to deliver vehicles on time.

Sabir said the government should also ask the assemblers not to work on only single model of bike or car and they should diversify their efforts by introducing new vehicles in Pakistan. Sources said the above practice of luring bike lovers is a kind of indirect sales in which dealers are lifting bikes directly from assemblers based in Sindh.

They said an investigation is going on against an assembler who was alleged of providing bikes directly to these kinds of dealers. Besides this mode of bike sales, a regular scheme of selling bike on “monthly installment” has gained pace in the last few years which is certainly an attractive option for many people who cannot afford to buy even cheap Chinese bikes on full cash payment. A large number of population still relies on private public transport since the government especially the Sindh has so far not come out with any urban or rural transport scheme. The top government officials of Sindh government are only paying lip service for providing effective transport system.

The major beneficiaries of this normal bike installment scheme are also young boys working in courier companies and food chains who use two wheelers to hand over parcel to the consumers.

The dealers take Rs 25,000 for 70cc bike as an advance payment leaving an open option for the consumers to pay monthly installments of two to four years. The total cost of bike swells to Rs 60,000 on installment. Consumers usually take the bike on installment and after using it for at least two years purchase another bike on same facility.

Sources said that the assemblers are reported to have reached an understanding with the Excise and Taxation Department that the original book of bike will have two names as (owner and seller). The registration charges are higher than normal registration charges due to inclusion of two names in the book.

The buyer gets the photo copy of bike book and documents after purchasing the bike while the sellers (dealers) hold the original documents. People have literally gone wild for two wheelers in the last one to two years since the law and order situation has improved coupled with better farm income from some cash crops. Pakistan has seen good sugarcane and wheat crops followed by rice.

Rural population and growers of various crops prefer Honda bikes due to its quality and durability as well as good after sales and service. The construction activities and other projects under China Pakistan Economic Corridor (CPEC) especially in up country has generated extra demand for bikes. Surprisingly the costly Honda bikes have surpassed its cheap Chinese bike makers in terms of sales by continuously breaking its monthly sales records.

Honda motorcycles broke its monthly sales and production record by achieving production of 90,800 and 93,060 units, respectively, in May 2017. Surprisingly, the second highest bike maker, United Auto Motorcycle, has also broken its production and sales record in May 2017 by assembling and selling 31,347 units each.

Overall bikes of Atlas Honda Limited hit 888,640 units in July-May 2016-17 as compared to 748,911 units in same period last fiscal. Suzuki bike sales stood at 16,725 units as against 16,099 in July-May 2015-16. Yamaha bike sales declined to 12,262 from 15,239 units. United Auto Motorcycle assembled and sold 298,329 bikes each in July-May 2016-17 as compared to 236,567 units in same period of last fiscal.

Some other assemblers continue struggling. For instance, DYL Motorcycle sales plunged to 6,972 units in July-May 2016-2017 from 7,375 units in same period last fiscal. Hero and Ravi bikes sales stood at 2,512 and 20,134 units as compared to 2,718 and 18,523 units.

Despite rising bike sales, the import of CKD/SKD kits for bike assembling fell to $73 million from $82 million in July-April 2015-16. It gives an impression that either the bike assemblers have achieved higher localization and they do not need imported parts or there is something wrong going on.

The two/three wheeler sector offers most preferred and economical means of transport and best alternative in the absence of public transport and thus holds considerable opportunity of growth. The figures of two/three wheelers essentially represent the organized sector and leading producers and shall be higher as there are 2/3 wheeler assemblers outside PAMA, Economic Survey 2016-2017 stated.

This exclusive article published in Monthly AutoMark Magazine’s July-2017 printed edition

 

Electric Cars – Do they have a future in Pakistan?

Muhammed Hanif Memon
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Electric Cars – Do they have a future in Pakistan?

Introduced more than hundred years ago, electric vehicles (EVs) are seeing a rise in popularity today for many of the same reasons that made them first popular. Be it a hybrid, a plug-in hybrid, or an all-electric vehicle, the demand for EVs will continue to climb as their prices drop and consumers look for ways to save money on usage as well as maintenance. Currently accounting for more than 5 percent of new vehicle sales globally, electric vehicles sales could to grow to nearly 7 percent – or 6.6 million per year – worldwide by 2020, according to a report by Navigant Research.

Hybrid and Electric Vehicles emerged in the Australian, Canadian, the US, and most of the European market in 2010. Initially, people were skeptical of buying and adapting to this technology. Electric vehicles are now starting to make a presence for personal use and we can observe the use of renewable energy for electric power generation. But it ends there. The entire commercial world is run on oil and gas – trucking, temporary power generators, agriculture, and construction equipment, etc. If anyone thinks solar energy can power a bulldozer at this point in time, then they do not possess any true understanding of how much power we generate with existing models over the renewable sources. We will, however, see more electric vehicles used by consumers, but we have to be realistic, in every sense of the word. There is a big difference between powering a car, like a Civic or even a Vezel, and powering a truck or 18-wheeler. That may not be possible in the next three years.

With this growing interest in EVs, and with an increasing emphasis on fossil fuel reduction and carbon pricing worldwide, automobile manufacturers are swiftly shifting their focus on the research, development, and manufacturing of EVs.

Like most of the developing countries, Pakistan too has a strong market for hybrid vehicles, with Honda Vezel, Honda FIT, Toyota Prius, Toyota Aqua, and other such models having a significant presence on the Pakistani roads. Leading automobile manufacturers, including Super Power Motorcycles, have started introducing EV models with a wide range of prices, targetingcustomers of diverse income groups. One such model is pricedat PKR 600,000, which suggest that Pakistani manufacturers are willing to risk investing in this market segment. Several members of the international automobile industry (South Korea, China, and Japan) also believe that Pakistan is a high potential market for EV technology, and local businesses are collaborating with them to bring EVs in Pakistan.

The auto industry in Pakistan is also going through a major shift mostly due to the recently introduced Auto Development Policy 2016, which led to the entry of major international players in the Pakistani market, which included manufacturers and importers of hybrid and electric cars. However, the duties imposed on the imported EVs amount to almost 50%, which makes these cars difficult to afford for the majority. The Pirani Group had previously written to the Secretary of the Pakistan Chamber of Commerce, and had asked him to reduce the taxes and duties on Imported Electric Vehicles from 50% to 0-5% for the upcoming fiscal year’s budget, to ensure that the cars become more easily accessible and available for the Pakistanis to buy.

However, EVs present two major problems in Pakistan. Firstly, the severe shortfall of electricity and the frequent power cuts due to ‘load shedding’. Secondly, the consumer mindset and their reluctance to invest in EVs as compared to them investing in conventional fuel cars. Electric cars, despite demanding high maintenance once every few years, are extremely fuel efficient and save up significantly on fuel costs. It is high time that people are made aware of the use of electric vehicles in Pakistan, especially in urban areas, to decrease the carbon footprint. Although people have been intrigued by the idea of hybrid cars, they are majorly still reluctant to completely transform their garage into fully electric cars due to long driving hours, even within cities. The technology is neither cheap nor simple to construct.

EV producers, importers, and investors can explore the possibilities of making ‘charging stations’ in Pakistan, whilst setting up plants that produce auto parts for these EVs. As compared to 43,000 charging stations in the U.S, Pakistan has next to zero charging stations. Pakistan needs to start planning for charging sources EVs will use once they are launched on a wider scale. While Dewan Motors did take up the initiative and installed three BMW Hybrid and EV charging stations in Lahore last year, which draws power from the national grid,replicating the same kinds of charging docks all over Pakistan is going to add significant load to the country’s growing electricity demand.Working on sustainable charging systems for EVs is another way of limiting the increase in electricity demand that EVs will have a need for, but all of that would be considered once the future of electric vehicle in Pakistan becomes a little more certain. For now, we will have to wait to know what road electric vehicles will take in the future. Let us all hope that it is a road worth waiting for!

This exclusive article is published in Monthly AutoMark Magazine’s July-2017 printed edition, written by: Ahsan Mirza

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