Automotive industry in Pakistan

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

The automotive industry in Pakistan (Urdu: پاکستان موٹر گاڑی صنعت‎) is the one of the fastest growing industries of the country, accounting for 4% of Pakistan's GDP and employing a workforce of over 1,800,000 people.[1] Currently[when?] there are 3200 automotive manufacturing plants in the country, with an investment of 92 billion (US$870 million) producing 1.8 million motorcycles and 200,000 vehicles annually. Its contribution to the national exchequer is nearly 50 billion (US$470 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[by whom?] 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, Kia, SsangYong, Volkswagen[7] and Hyundai[8] have expressed interest in entering the Pakistani market.[2][9] Pakistan has not enforced any automotive safety standards or model upgrade policies. Obsolete vehicles including the Mehran, Bolan, and Ravi continue to be sold by Pak Suzuki.[10]

History[edit]

Early years (1950–1969)[edit]

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.[11]

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)[edit]

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 Tractor 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)[edit]

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 2002 to 2007, Small Assemblers and many Bike importers started assembling of Replica CD70CC with Chinese collebration, in the year annual production of bikes reached its higher level auto sales reached record sales 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)[edit]

In 2010 the sales rebounded and began increasing again. The auto industry predicted a growing demand in Pakistan and invested over 20 billion (US$190 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 1000 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[12]

Historical production by year[edit]

Automobiles[edit]

Historical production by year[13]
Year Production
1993
76,000
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

Motorcycles[edit]

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

Active Manufacturers[edit]

Automobiles

Motorcycles

Commercial Vehicles

Defunct Manufacturers[edit]

References[edit]

External links[edit]