Indus Motors have to spend 7 billion rupees to introduce a new model of Corolla

14 39

BR (Business Recorder) sat down for a brief interview with the CEO of Indus Motors, Parvez Ghias and Sohail P. Ahmed, Vice Chairman at House of Habib to answer some of the most popular questions which float the minds of many.

To read the full interview, you can go here but we’ve shared some points of interest below.

On a question put forward by BR about the growth of the auto industry, Parvez Ghias gave a lengthy lecture which basically just said that the growth or localization hasn’t been done completely by the companies owing to the slow rate of return on the investment done by automakers to introduce a new car.

He further said that Indus Motors will launch the new Corolla before the end of 2014, but the company began investing three years ago in tools, dyes and moulds and a total of about Rs 8 billion has been invested to launch the car.

When BR asked whether Indus Motors was afraid to compete with the used car, Sohail Ahmed replied with the example of India where imported used cars have a duty of 100% as compared 60% duty of locally made car whereas the situation in Pakistan is exactly the opposite.

He further added that market depends on per capita income, it does not happen just because you’re 180 million people so if the per capita income is good, the interest rates are high, the demand will not be good and automotive industry needs demand to thrive.

BR then responded that whether Indus thinks that there’s no more room to grow to which they replied that the demand now is for small and cheap vehicles, there is no demand for luxury car because people don’t have the money (and yet Indus introduced Fortuner?!), the two-wheelers annual sale is 1.6 million units.

He further added that as an example that a new model of a car like Corolla takes about Rs 7 billion to be invested in technology, tools, training, platform, etc to be launched in the country and when the volumes are absent, it takes a lot of while to get sufficient returns on the investment within the model’s life. That’s the reason why two-wheel manufacturers and others have continued selling the same vehicles for around 3-4 decades and hence they’ve enjoyed considerably good returns and localization.

BR

 

Google App Store App Store
14 Comments
  1. Faisal Auh says

    The picture shown in the Article is not the one which will be lauched i thnk as in UAE its launched already in European shaper, and that very Good shape

  2. Anonymous says

    Would Mr. Parvez Ghias also like to explain that if India has 100% duty on customs, they also have dozens of companies manufacturing cars in India and consumers have alot of choice and benefit from the competition. However, we have only a few manufacturers including toyota who have made a lobby and do not let any new entrant into the market while they themselves make low quality and expensive cars and make billions in profit.
    Secondly, its actually funny that he mentioned that bike manufacturers in Pakistan have not changed the design of the bikes since 20 years and therefore earning lot. It means for sure that if car imports to Pakistan are banned by the government, Toyota would sell the same model for atleast 20 years before introducing a new design.

  3. Nabeel Shk says

    Obviously they have to spend money to strip it out of every thing and fit Old Engines and remove all facilities from a Car…..

  4. Muhammad Ali says

    Corolla 2013 shape is better than this crap!

  5. Zanib Malik says

    Guys get together and make your own car at low cost not that difficult if you use a carb instead of fuel injection

  6. Sameer Khan says

    I cant understand

  7. Shakil Sadiq says

    The," Car Manufactures Club," in Pakistan , is unfortunately the worst that could happen to the Auto Industry in Pakistan. I guess Mr.Ghias, sums up his state of mind by stating, " to grow to which they replied that the demand now is for small and cheap vehicles, there is no demand for luxury car because people don’t have the money (and yet Indus introduced Fortuner?!), ".. That's exactly what they do >>> Manufacture CHEAP Cars !!
    If they wish to do any better, it would be advisable to first remove their heads from those deep cavities in their anatomy and study the Auto Industry in Pakistan; Understand it and strategize accordingly. Their whimsical thought pattern has already cost them the Fortuner Launch !! Overpriced, Underperforming and an Utterly Un required model. Would Mr.Ghias know the names of the 3 Top Selling Sub Compacts in the Region… ( That is assuming that he knows what Sub Compacts refer to..)
    CHEAP , is not what this nation wants, Mr.Ghias..

  8. Khalid Malhi says

    Is the Thailand market bigger than Pakistani market ,secondly the Indian market has more controls on its auto industry than Mr.Ghais wishful thinking.Toyota interior is cheaper than a motorcyle rickshaw.They give old model engines in the form of new models. Their fuel efficiency is far less than the same model operated in other parts of the world. Their margin of profit is greater than the surrounding auto industry. In india the pop 1.2 billion how many have cars not even 1% but compare with Pakistan you will feel the difference. But these blood suckers want to have more give nothing.Why don't you compare with standards of Japanese Toyota what are u giving us.Just eyeing on our pocket but no standards bribing and mafia creation is your dream of business.

  9. Safi Bajwa says

    u r dead right bro these monopolists have done all the damage and yet they r not satisfied with theire sales funny , corrolla fsd was said to be the most selling showroom of the country selling more then 3000 cars a month and yet they cry jokkers if gov will allow mitsubishi , volvo, mercedese, damler christler, bmw , and others no body will purchase toyota the last option its cars are cheaply manufactured and highly priced nobody or no authority ahve any check on price they inscrease and decrease on their own will sad a nighmare for a pakistani buyer who have no choice but toyota to buy MONOPOLISTS

  10. Asad Kazmi says

    Result of this post on Toyota-Indus website 😛

    Bandwidth Limit Exceeded
    The server is temporarily unable to service your request due to the site owner reaching his/her bandwidth limit. Please try again later.

  11. Abbas Khan says

    Not only do they use cheap engine/body parts, they also use cheap web hosting 🙂 Mr. Ghias have to cut corners everywhere!

  12. DrMasood Akhtar says

    Mr.prvaiz also explain to the consumers about the quality and performance of pakistani made car compared to imported used cars,or even with indian cars.I as a consumer prefer to purchase used imported cas as compare to pakistani made new car.It;s not only with toyots ,suzuki pakistan also have very low grade material an performance

  13. Usman Ali says

    As according to the CEO of indus motors there is demand for small cheap vehicles i dont understand why toyota stopped production of Cuore instead of upgrading it. Indus should launch new models of the fuel efficient (EFI) small 660-1000 cc cars as the used cars being imported from Japan. These will definately sell if they are well made and are as fuel efficient as the imported ones, keeping in mind the high fuel prices and lack of CNG being faced by people. Also if the company can reduce its profit margin this can be compensated by the number of cars sold.

  14. Imran Farooq says

    haha..that's the spirit , u take initiative m with u

Leave A Reply

Your email address will not be published.