Local Automakers Overcharge Customers To Send Money To Japan

local automakers

The upcoming auto policy of Pakistan has become a mystery now. Talks have been going on for months between the government and the stakeholders of the local auto mafia but nothing fruitful have come out of it as yet.

The government seeks to ban the production of 10-year old vehicles so that new technology is introduced in Pakistan which would enhance the skill level of our workers. However, the stakeholders of the local auto mafia are not happy about it and pressurizing the governmetn to remove this point from the draft.

The stakeholders of the local auto mafia are adamant that government should completely ban the import of used Japanese cars because crucial foreign exchange bleeds out from the country, while State Bank of Pakistan is arguing that import should be allowed without restrictions to provide customers with safe and better quality vehicles.

Talking about bleeding foreign exchange, according to a recent report by Business Recorder, the local automakers are overcharging their customers (surprise) and transferring money ranging between Rs. 0.5 million and 1.o million per vehicle to their parent companies in Japan.

It is to be noted that by transferring this money, these assemblers are spending the precious foreign exchange of Pakistan, the same foreign exchange they have been using as a leverage to negotiate terms of the auto policy with the government.

This point was recently raised during a meeting about the auto policy between the representatives of Pakistan Association of Automotive Parts and Accessories (PAAPAM) and the Ministry of Commerce.

This should not come as a surprise to you that the local auto mafia is putting in a lot of effort to manipulate the auto policy in their favor so they could continue to sell their obsolete econo-boxes to the consumers. I think it is high time now that we’d show them where they stand otherwise that time is not too far when would be forced to pay Rs. 1.5 million for the Suzuki Eyesore.

Fahad Ullah

I build products and review cars for PakWheels. I am also famous for typing more words than anyone wants to read.

  • oliver

    “We show them, where they stand”, in Pakistan only a stakeholder, or consumer, gets no right to bud in their opinions or debate about the pro or cons of the policy against the higher authority , also known as the “Auto mafia”. Given their past history and experience it should be the duty of state to, restored the 100 year old Mehran and introduced better deal, but apparently, so far the policy, judging by the masses who are in charge seems to be more dreadful and sorrow than ever before.

  • Osama Ali

    in my opinion 5 years old japanese cars are much better than local cars and offcourse they are much cheaper. what we should we do as consumers to put to end this monoply? kindly do write…

  • asim alvi

    One of my buddy had bought a liana and challenged me because i have a 22 years old toyota corona diesel. an independent person tested both. liana was batter in body work as my car has dents and scratches all over the body and the diesel engine noise (which i love to have). on the points such as comfort, durability, running cost each and every time old still gold, long story short. in the end my buddy was inches from committing suicide hahhahaha . It is a fact that the even the same company models are different from country to country and in case of beloved Pakistan, standards have no limits DOWN WORDS when it comes to automobiles.

  • Shabbir

    Allow used imported cars and let Suzuki, Toyota, Honda divest manufacturing plants. We’ll be happy because we’ll get high tech cheap cars. Not a big deal, only 10/12 thousand poor will be jobless, they will somehow find some ways to live. Life is always tough for poor.

  • MTS

    very disrespectful of you to even think that…
    not 10/12 thousand would be jobless, actually millions of them would be as this would be a chain reaction. Many businesses are integrated, i feel real bad for you.

  • Muhammad Saud Khan

    If only customers who buy these cars tell them y u guys r selling these cheap cars at such high price and v r not ready to buy such cars. these companies will be on their knees belive me. If only one month any don’t buy new car just go to show rooms and say your quality of cars are so poor and prices are so high v don’t want to buy your cars any more and just come back don’t buy these cars just for one month. These companies will be on their knees my friends. if we buyers just get together and restrict our self’s that we wont buy any new car for just one month. then see the response. no matter how ugly no matter how expensive product they through at us we all start buying it using it with out asking a single question. now you just check this how many people ask question about quality or price or options when they go to buy new car. NONE. please start asking questions before spending your hard earn money plz wake up my friends

  • Shabbir

    They won’t change much. Did they change their actions after govt inducted large quantity used cars? Not much. They are foreign companies they want huge profits or would move to countries where profits are. No wonder why Hyundai and Kia didn’t chose any other partner after dewan. they just left the country, isn’t it. Anyway, if they leave no much difference would be done. what happened after Pakistani seth moved textile business to Bangladesh. Did you find any major impact on economy? No! ghareeb admi koi or kaam ker le ga like some farming stuff. they are poor because they didn’t put efforts to be rich.

  • Abdul Akbar

    Never Ban something untill and unless you provide its alternative
    Never open Import so much that local industry dies
    Government work is to make policies keeping in mind all points, every decision has its negative impact as well as positive. Always choose the one with less negative points and which is better in Long run for country and people

  • Sh

    I think you are speaking the same language that of local oem mafia. Why does industry need so much government support of such level. At the end of the day customer is KING. customer need high spec car even if used, give them high spec used car. Why do we really need locally produced cars anyway??? New zealand used to have auto assembly plants now they don’t have. they are importing used cars from Australia.

  • NC

    The Mafia get generated when no competition exists. The local car industry with label names from japan are producing low qualtiy/feature cars though demanding even more price than their cars sale in europe and usa. I remember a news from years (good to say ages) back saying the local industry will produce the car machinary starting with 25% in pakistan and will gradually increase the production to 75%. I am sure there exist no car with 75% made in pakistan. I don’t think pakistan will ever be a 100% mechanical industrial country. The think tanks sitting in govt or near to the govt may change their prespectives and realise not to be a 100% car manufracturing country. Let open a moderate import to create a competition. The labor that works in car assembling can adjusted to car overhauling, tuning, fitness checks (if it will ever established seriously), on spot helping and repairing…

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