Tuesday, May 02, 2006
Two European carmakers to set up plants
By Arshad Hussain
KARACHI: Two more European car manufacturers will introduce their latest model cars in Pakistan by the end of this calendar year.
The government of Pakistan has already allowed the two companies to import their complete build units (CBU) initially.
French company Renault will introduce to the Pakistanis its Logon models.
The government has also allowed a consortium of four investors, including an Arab and three Pakistani investors, to introduce European Black Cap car in Pakistan.
“The federal government is working on an auto policy that would be announced in the next few weeks,” an industry source told the Daily Times here on Monday. “The government is likely to announce a number of incentives for these two European carmakers.”
“The incentives to be announced by the federal government will help the carmakers to set up their plants anywhere in the country,” the source said.
French Renault carmakers had already introduced their vehicles in India and now they are looking towards the Pakistani auto market.
“The company has promised to the Pakistani government to initially invest Rs two billion in Pakistani auto industry and it would import 1000cc to 1300cc cars into the market,” the source said.
The company has demanded a further reduction in customs duty from 35 to 15 percent in the coming budget and exemption from all taxes for the next five year, the source said.
Similarly, a Pakistani consortium, SPL, has been allocated several acres of land in Dhabeji, a place close to Karachi.
The consortium with an initial investment of Rs 2.5 billion would set up a Black Cap car-manufacturing plant in Pakistan and it would introduce 800cc to 1300cc cars. The ministry of finance has allowed the consortium to import 300-400 CBU cars in Pakistan.
“Both the new investors are looking towards the government’s auto policy, which is to be announced,” the official said.
Two European cars, BMW and Mercedes, are already plying in Pakistan and considered prestigious despite being highly expensive.
“The new comers are introducing vehicles below 1300cc power engines and they should be so priced that they should compete with other vehicles like Suzuki, Toyota and Honda,” an analyst said. According to sources, the government has set up a committee, headed by Prime Minister Shaukat Aziz, to listen to complaints of the local auto industry.
The government has refused to give any new incentive to the local auto industry, an industry official said.