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Pakistan’s premier magazine on automotive, engineering & energy sector Monthly
AUTOMARK Editor M. Hanif Memon
Yamaha likely to shelve plan to invest $150mn
Yamaha Motorcycle Company is likely to Advisors Technical Editor shelve its plan to invest $150 million in Imtiaz Rastgar Muhammad Shahzad Pakistan after Prime Minister Raja Pervez CEO, Rastgar Group & Ashraf, the Board of Investment (BoI), CBI External Expert, the Ministry of Commerce and Planning Ex-chairman EDB Advertising Manager Islamabad Abdul Khaliq Commission failed to extend new entrant incentives. Haider Nawab Official documents showed that the ECC Advisor Planning & Circulation Manager in its meeting on August 16 this year, Development Tahir Siddiqui Toyota Southern Motors c on s t it u ted a co mm it t ee un de r Toyota Defence Motors the Chairmanship of the BoI to Karachi Computer Operator prepare a presentation for the ECC MurtazaHanif Muhammad Yousuf Shaikh regarding the domestic motorcycle Founder & Chairman industry. Pakistan China Motorcycle Industry Council Web Master The committee was authorised to Karachi Mustafa Hanif associate manufactures, importers and vendors of motorcycles with its Abdul Majeed Sheikh President, deliberation. The ECC was further AOTS-ABK Dosokai, informed that in pursuance of its decision, CONTRIBUTING IN Karachi Regional Center THIS ISSUE extensive consultations were held with Director Industrial Lesion, Ali Hassan the Pakistan Automobile Manufacturers NED University, M. Yousuf Shaikh Karachi Association (PAMA), Pakistan Association Asif Masood o f Au t o Par t s a nd Ac c es s o ri es M. Owais Khan Engr. IHT Farooqui M. Hanif Memon Manufacturers (PAAPAM) and leading General Manager Plant manufacturers, importers and vendors Karakoram Motors (Pvt) Ltd., Karachi of motorcycle industry. After detailed deliberations, the committee finalised J. Pereira its recommendations relating to: (a) Senior General Manaer general tariff reduction for motorcycle After Sales Service and Parts Master Motor Corporation Ltd., industry; and (b) policy for new entrants Karachi of the motorcycle industry. The Committee presented its recommendation to the ECC for The views expressed by contributing consideration. During ensuing discussion, it was noted writers and comments do not that against 113 units, only 68 units necessarily reflect the views and were operational. It was stated that artificial tariff barriers were allowing the policies of the Monthly AutoMark corporatisation of the companies magazine's management. manufacturing motorcycles, which needed to be removed. AutoMark REGD: SC-1330 It was also stated that the new Published every month by M. Hanif Memon technology, if brought into Pakistan either Postal Address by the new entrants or by the existing Active Communications manufacturers, would be Euro-II D-68, Block-9, Clifton,Karachi Visit us: www.automark.pk compliant. E-mail: magazine@automark.pk automarkpk@gmail.com Tel : 021-32218526 Mobile: 0321-2203815
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CONTENTS
Monthly AutoMark Pakistan Auto Industry look for Chinese investment to manufacture Motorcycle engines, Small Cars, Vans & Trucks Exclusive Article by M. Yousuf Shaikh, Founder & Chairman, PCMIC
14-16
An Exclusive interview with Mr. Muhammad Sabir Shaikh, Chief Executive of Sitara Auto Impex, Karachi
17-18
Ministry of Industry lobbies for cutting used car age limit to support assemblers Exclusive Article by M. Owais Khan
20-22
Paapam news update
23
Mass Transit & Soaring Car Culture Exclusive written by Asif Masood
33-35
Local Assembled/Imported car price
36
CIMA 2012 breaks all records CIMAMotor-2012 - Exclusive after event report by AutoMark
37-38
Interview with Wang Wei (Director of CimaMotor) at CIMAMotor exhibition in China
38
Japanese branded motorcycles in China Trade Exhibition (Photographs by AutoMark)
39-40-43
China Automotive Industry - News Update 41-42 Monthly AutoMark's editor visits Lifan Motorcycle Factory in Chongqing, China Exclusive coverage by M. Hanif Memon
43-44
The pictorial Story of CIMAMotor-2012 Motorcycle & Trade exhibition in Chongqing, China by AutoMark Magazine
46-47
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Automotive Sector - Performance Award
Servis Tyres received Best Vendor Performance Award
In recognition and acknowledgement of exceptional performance and exemplary service, Atlas Honda Limited recently awarded Servis Tyres with the "Best Vendor Performance Award" for 2012. The Best Vendor Performance Award acknowledges outstanding quality, value, service, innovation, delivery, organizational health, supply chain management, diversity, technology, environmental practices and price. As the winner of this year's award, Mr. Arif Saeed, Director Servis Industries Limited (SIL) received the prestigious award from Mr. TOyama, Sr. Managing Director, Honda Motor Company, Japan. The impressive award ceremony was held on 3rd November, 2012 at Atlas Honda Plant.
Monthly AutoMark Magazine
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Exclusive Article by M. Yousuf Shaikh
Monthly AutoMark Magazine
Pakistan Auto Industry look for Chinese investment to manufacture Motorcycle engines, Small Cars, Vans & Trucks As China warmly seeks investment opportunities. to build skills of entrepreneurs, seek investment and exchange technologies. The Business Development Centre would help strengthen economic relations between businessmen of the two countries.
Introduction:Muhammad Yousuf Shaikh, the Founder & C h a i r ma n o f Pak is tan China Motorcycle Industry Council, offers his a n al y s i s o f t h e automotive trade & industry trends from Pakistan & China. The chairman PCMIC working with automotive trade & industry for over two decades, Yousuf believe that Chinese auto maker’s investment could help Pakistan to design and produce its own automobiles mainly motorcycles as the Chinese & Indian motorcycle manufactures design & produce their own products. Pakistan Auto Industry requires intensive investment & huge financial resources. The result of this development could have profound implications on the Pakistan’s auto industry over the next d ecad e. T o reach him, email : pakchina.mic@gmail.com . The Chinese government is making allout efforts to take its economic relations with Pakistan to a new height by aggressively exploring opportunities for investment and joint ventures in various s ec t o r s o f t he e co n o my . T h e establishment of the Nanchuan Industrial Park Business Development Centre (in Lahore) will go a long way in achieving this goal,” said Huang Guojun, director general of Nanchuan Industrial Park in Xining City, Qinghai province. He said the centre was the latest example of Chinese efforts to increase links between Pakistani entrepreneurs and
t hei r Chinese counterp arts. “Connections like these are important because the entrepreneurs unlock growth.” Nanchuan Industrial Park Honorary Consul Akhtar Nazir Khan said he accepted the post on the condition that Chinese businessmen would also invest in Pakistan if they were seeking investment from Pakistan. Chinese investors are interested in investing in auto, mining, marble, energy, chemical and other potential sectors. “Business-friendly environment is a prerequisite to foreign and local investment,” he said. The business centre would organize events throughout the country in a bid
The Nanchuan Industrial Park would connect Pakistani entrepreneurs with leading Chinese entrepreneurs and investors, who would be able to exchange experiences and discuss business trends, leading to investment in both countries. The promotion of commercial activities was of supreme importance for achieving economic stability in any country. Chinese automobile manufacturers avail themselves of investment opportunities in Pakistan’s auto industrial sector. The council’s Chairman, China region Mr. David McMullan is also delighted on the establishment of the Nanchuan Industrial Park Business Development Centre (in Lahore). It is decided to take an initiative proceeding and he intends to visit soon to meet government official to speak about the possibility of Chinese manufacturers to exploring the Pakistan Auto industry and taking forward the long term strategic agenda that highlighted in media reports Pakistan must raise its game to compete for Chinese investment in automotive R&D and manufacturing. In order to make this happen, the Pakistan’s Chinese vehicle manufacturers/ assemblers need an ever
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Exclusive Article by M. Yousuf Shaikh - continued
Monthly AutoMark Magazine
In recent years, we have witnessed that the industrialization of many Asian countries greatly depend on the development of their automotive industry consecutively motorcycle industry. Similarly, automotive industry acted as a catalyst in the overall growth of the industry in China, India, Pakistan and Koreas and the consequent wellbeing of their citizens.
more strategic, collaborative relationship with the Government to work with supply chain and other stakeholders to achieve long term goals. We want the Council to help make that happen. The Motorcycle Industry Council will be an opportunity for the Government and industry to work together on the long term strategic development of the sector. We thank and welcome government offer to Chinese automobile manufacturers to avail themselves of investment opportunities in Pakistan auto industrial sector. The economical small cars, van & Small trucks manufactured in China usually by Chinese Motorcycle manufacturers such as Chongqing Lifan Industry (Group) Co., Ltd, Chongqing Yinxiang Motorcycle Group Co., Ltd, Chongqing Shineray Motorcycle Co., Chongqing Yuan Group - China supplier of Motorcycle, automobiles . As a pioneer of the Chinese Automotive especially Motorcycle trade & industry businesses in Pakistan, I was the first one to introduce economical high quality Chinese motorcycle by top Chinese motorcycle manufacturers to Pakistan in 2002. I trained many Chinese motorcycle manufacturing companies in China to design the 70cc and 125cc motorcycle for the Pakistan market. In a short time, there were several motorcycle importers cum assemblers establishing the Chinese motorcycle assembling plants in Pakistan due to availability of suitable CKD parts by Chinese suppliers. As few years ago
motorcycle assembling cum manufacturing was the dream of private ventures. But after the availability of good quality right parts in China and in Pakistan with the help of Allah Rabbulizzat this dream has come true. My experience includes senior roles in product development, marketing and business management. I am the Founder and Chairman of Pakistan China Motorcycle Industry Council, a Pakistan & China Motorcycle trader & Industrial group network for Pakistanis, Chinese and their friends. I also am serving as Chairman of the Global Automotive Group. In addition to being a Pakistan & China motorcycle trade & industry watcher, an investor, business consultant and avid follower of the Chinese Motorcycle Trade & Industry markets, I have more than 20 years experience in the Motorcycle trade & industry.
Being a Founder & Chairman PCMIC, I am working on to setting-up an inventive research & development facility for Pakistan to Design & Manufacture Pakistan’s own motorcycles engines and auto parts in public private partnership. My years of experience in motorcycle t r ad e & i n d u s t r y f l o ur i sh i n g development and launching of several new motorcycles in Pakistan, the Pakistan China Motorcycle Industry Council and their associates are
committed to supporting entrepreneurs to develop emerging technologies that become the driving industries of the future. These efforts are supposed to facilitate the creation of numerous companies and thousands of jobs in Pakistan. I am looki ng for an opportunity to set-up a facility for a Pakistan motorcycle industry. I come with extensive experience of setting-up facility for Pakistan companies on a global sourcing motorcycles and engine manufacturing in Pakistan. With more than twenty years experience in import, Sales and Marketing in the automobiles esp ecially Chi nese motorcycle & small cars industry, I have successfully launched and promoted several new products imported from China. I am writing concerning my interest to market the Pakistan auto industrial sector in China and to invite Chinese manufacturers to invest in Pakistan through joint ventures or direct entity. Also the export of made in Pakistan motorcycle as I believe there are several areas in which I could help Pakistan to strengthen Pakistani/Chinese motorcycle shares in the international market This latest expansion & development of government regarding to invitation for investment of Chinese automobile manufacturers interests me to offer my proficiency (familiarity with hundreds of Chinese automobile manufacturers) for Pakistan as I feel my experience and language fluency could make an enormous difference to your team, and thus ensure the success of this expansion.
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Exclusive Article by M. Yousuf Shaikh - continued
Monthly AutoMark Magazine
Over two million motorcycle assembling Pakistani companies should do the joint venture in public private partnership with their foreign counter part to manufacture the key parts of motorcycles such as the complete engine, carburetor, Drive Chain, hundreds of engine separate components ( Cylinder Head, Ring Piston Set, Bearings, Bushes, Timing chain, crankshaft, and many other components ) and also the Handle switches, Lock Set, Wheels Hubs & Breaks, Complete absorbers and speedometer movements as there is no true manufacture in Pakistan. In recent years, we have witnessed that the industrialization of many Asian countries greatly depend on the development of their automotive industry consecutively motorcycle industry. Similarly, automotive industry acted as a catalyst in the overall growth of the industry in China, India, Pakistan and Koreas and the consequent wellbeing of their citizens. It is indeed heartening that the motorcycle industry has smiled at Pakistan. Fortunately the last few years have witnessed phenomenal growth in the industry in terms of production and sale. Today the customers have choice to pick from a wide range of motorcycle brands at very competitive prices. The Pakistan automotive industry has been around for more than 50 years, and today is considered an industry that is highly important to the Pakistan economy. The motorcycle industry employs an estimated 100,000 people. The motorcycle sector of Pakistan’s auto industry produced over 2 million motorcycles annually, with 20,000 being exported. Pakistan is a large producer of smalldisplacement motorcycles & cars but there is no thriving local development by auto industries. The majority of the
motorcycles being manufactured in Pakistan are the 70CC motorcycles. Most of the parts used in the frame, suspension, engine etc are interchangeable, or can be used with minor adjustments. Over two million motorcycle assembling Pakistani companies should do the joint venture in public private partnership with their foreign counter part to manufacture the key parts of motorcycles such as the complete engine, carburetor, Drive Chain, hundreds of engine separate components ( Cylinder Head, Ring Piston Set, Bearings, Bushes, Timing chain, crankshaft, and many other components ) and also the Handle switches, Lock Set, Wheels Hubs & Breaks, Complete absorbers and speedometer movements as there is no t rue manufacture in Paki stan. The engine is a core part of the motorcycle, and the demands for motorcycle engines are highly related to the demands for motorcycles. Motorcycle engine market has great potential as a result of the booming motorcycle demands. Meanwhile, although the auto industry may be a big earner, all four wheel vehicle manufacturers at present are foreign joint venture. Pakistan parts manufacturers depend on foreign technology and the country is still unable
to design and produce its own automobiles even motorcycles. This makes it difficult for the industry to develop. Today automotive technology is changing quickly due to environmental concerns and the rising prices of fossil fuels. This has led auto-makers around the world to develop vehicles that have improved fuel economy and emission levels. Many have also introduced hybrid and electric vehicles, while developing fuel-cell vehicles for the future that would emit nothing but water vapour. Auto industry is divided into two markets. The mainstream market consists of manufacturers who are from overseas joint venture. The parts manufacture companies that are Pakistani-owned or have major Pakistan shareholders are who depend on design and production technology from abroad. The other market is the niche market, consisting of SMEs producing Chinese motorcycles & Parts. In this market, most of the companies are Pakistani and products are sold domestically, where there is little foreign competition but big competition within themselves. Most of the players have not been utilizing much technology in terms of design, man ufact ur e an d e ng i ne eri n g.
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Exclusive Interview - Face to FAce
Monthly AutoMark Magazine
An Exclusive interview with Mr. Muhammad Sabir Shaikh, Chief Executive of M/s. Sitara Auto Impex, Karachi Introduction: By qualification Muhammad Sabir Shaikh is a lawyer, albeit a nonpracticing one. By trade he is a progressive assembler-cummanufacturer of motorcycles. He did his LLB from SM Law College Karachi but he has been associated with the twowheelers over the years. He was an authorized dealer for all major brands of motorcycles at the country's biggest motorcycle market, Akbar Road Karachi. He is currently the vice chairman of FPCCI's Standing Committee on Small Traders and Cottage Industry and is the chief coordinator of Association of Pakistan Motorcycle Assemblers (APMA). He was also the ex-president of Karachi Mot orcy cle D ealers Association (KMDA) for many years. He is the chief executive of Sitara Auto Impex which has technical collaboration agreement with the Chongqing Guangjie Motorcycle Industries (Group) of China to assemble and manufacture Guangta & Sitara brands motorcycles in Pakistan. Automark: What prompted you to turn to motorcycle assembling? Sabir Shaikh: While working as an authorized agent for all major locally produced brands over the years I realized that rising motorcycles prices were driving the potential buyers away from the market. This in turn was translating into decreasing sales and at times the things were so bad that it was hard even to meet the running expenses — not to mention profitability because dealers usually work strictly on commission only when they sell. That made me realize that the prices of locally assembled motorcycles amidst the protection accorded to it from imports vide prohibitive duties is the primarily reason for the downturn. I also realized that under such circumstances the prices would keep on increasing to have an
adverse effect on the business due to shrinking purchasing power. Automar k: When y ou st arted assembling of Guangta and Sitrara brands motorcycle? Sabir Shaikh: We started commercial production in September 2001 at our plant in SITE area on Super Highway near Sohrab Goth Karachi. At present we are manufacturing a single model, GT 70 and hope to produce a number of other models in near future. We have suspended production of Sitara brand ST-100 and ST-125cc bikes due to very tough competition between the assemblers. One of the main reasons of closing down the production of above 70cc was falling profitability due to losing value of the rupee against the Chinese currency which made imported parts costlier. Another reason was no reduction in customs duty on parts by the government. Automark: Do you have an approved deletion program? Sabir Shaikh: The deletion program of the Engineering Development Board (EDB), Ministry of Industries and Production were suspended/cancelled in 2005 and in the year 2006 the
government introduced Tariff Based System (TBS) which is already approved to all OEMs who have set up their plants in the country under SRO 656/2006. In the same year, the government approved auto industry development plan for next five years which is also expired on 30.6.2011. Its extension also expired on 30.6.2012. Currently there is no approved policy of the government for the bike industry for next five years. Automark: What consumers as well as the local industry benefitted from the deletion program, TBS and AIDP? Sabir Shaikh: Actually the Japanese had formulated the deletion programs up to 2005 in Pakistan for the auto sector. In t he 2006, Pakistani government officials made new TBS and AIDP for the auto sector for next five years. It was also hijacked by the Japanese industry. If one can check record of the Ministry of Industries original SRO 656/2006 was amended a s p e r J a p an e s e a s s e mb l e r s ’ requirement every year and Pakistan’s own motorcycle and commercial vehicle industries affiliated with Chinese firms did not get any benefit of SRO 656 and TBS. Low price of Chinese bike of around Rs 30,000 as compared to Japanese assembled bikes is still providing a big relief to the consumers who cannot afford four wheeler due to high cost of living.
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Exclusive Interview - continued
Introduction: By qualification Muhammad Sabir Shaikh is a lawyer, albeit a nonpracticing one. By trade he is a progressive assembler-cummanufacturer of motorcycles. He did his LLB from SM Law College Karachi but he has been associated with the twowheelers over the years. He was an authorized dealer for all major brands of motorcycles at the country's biggest motorcycle market, Akbar Road Karachi. He is currently the vice chairman of FPCCI's Standing Committee on Small Traders and Cottage Industry and is the chief coordinator of Association of Pakistan Motorcycle Assemblers (APMA). He was also the ex-president o f Karachi Motorcycle Dealers Association (KMDA) for many years. He is the chief executive of Sitara Auto Impex which has technical collaboration agreement with the Chongqing Guangjie Motorcycle Industries (Group) of China to assemble and manufacture Guangta & Sitara brands motorcycles in Pakistan. Automark: What prompted you to turn to motorcycle assembling? Sabir Shaikh: While working as an authorized agent for all major locally produced brands over the years I realized that rising motorcycles prices were driving the potential buyers away from the market. This in turn was translating into decreasing sales and at times the things were so bad that it was hard even to meet the running expenses — not to mention profitability because dealers usually work strictly on commission only when they sell. That made me realize that the prices of locally assembled motorcycles amidst the protection accorded to it from imports vide prohibitive duties is the primarily reason for the downturn. I also realized that under such circumstances the prices would keep on increasing to have an adverse effect on the business due to shrinking purchasing power. Automark: When you started assembling of Guangta and Sitrara brands motorcycle? Sabir Shaikh: We started commercial production in September 2001 at our plant in SITE area on Super Highway near Sohrab Goth Karachi. At present we are manufacturing a single model,
GT 70 and hope to produce a number of other models in near future. We have suspended production of Sitara brand ST-100 and ST-125cc bikes due to very tough competition between the assemblers. One of the main reasons of closing down the production of above 70cc was falling profitability due to losing value of the rupee against the Chinese currency which made imported parts costlier. Another reason was no reduction in customs duty on parts by the government. Automark: Do you have an approved deletion program? Sabir Shaikh: The deletion program of the Engineering Development Board (EDB), Ministry of Industries and Production were suspended/cancelled in 2005 and in the year 2006 the government introduced Tariff Based System (TBS) which is already approved to all OEMs who have set up their plants in the country under SRO 656/2006. In the same year, the government approved auto industry development plan for next five years which is also expired on 30.6.2011. Its extension also expired on 30.6.2012. Currently there is no approved policy of the government for the bike industry for next five years. Automark: What consumers as well as the local industry benefitted from the deletion program, TBS and AIDP? Sabir Shaikh: Actually the Japanese had formulated the deletion programs up to 2005 in Pakistan for the auto sect or. In the 2006, Pakist ani government officials made new TBS and AIDP for the auto sector for next five years. It was also hijacked by the Japanese industry. If one can check record of the Ministry of Industries original SRO 656/2006 was amended a s p e r J ap a n e s e a s s e m b l e r s ’ requirement every year and Pakistan’s own motorcycle and commercial vehicle industries affiliated with Chinese firms did not get any benefit of SRO 656 and TBS. Low price of Chinese bike of around Rs 30,000 as compared to Japanese assembled bikes is still providing a big relief to the consumers who cannot afford four wheeler due to high cost of living. Automark: Why all the Chinese
Monthly AutoMark Magazine affiliated assemblers have not achieved any remarkable success compared to few Chinese assemblers? Sabir Shaikh: My years of association with the two-wheelers show that continuously increasing prices and declining purchasing power is taking a heavy toll on the sales of two-wheelers. Declining value of the rupee and tough competition between the assemblers has eroded the profitability of the industry. In Pakistan there is no one policy for bike all over the country. The Ministry of Industries introduced three different S ROs fo r t he assemb li ng an d manufacturing of two wheelers and their parts. Under three SROs namely SRO 656/2006, SRO 655/2006 and SRO 693/2006 different assemblers have been taking differing benefits of these SROs for importing their CKD parts from their counterparts. Secondly all the dry ports have their own policy for imported parts for the bike assembling and due to this a number of assemblers have failed to produce any desired results. Currently, in Pakistan 1.4 million bikes are only 70cc and its production cost is Rs 40,000. All the companies are selling their 70cc to their dealers at the rate of Rs 40,000 (ex-factory price). A number of assemblers are not coping to keep up pace and failing due to depressed profit margin. Automark: Which is your biggest market? Sabir Shaikh: We are based in Karachi and that should have been our biggest market. If we sell our product in Punjab the transportation expense costs Rs 2,000 per unit which also adds in our wholesale price. As a result, our wholesale price goes up to Rs 42,000. In Lahore, the assemblers of Punjab are selling their products at Rs 39,500 (exfactory price). It means we cannot suffer a big loss by selling our product less than Rs 42,000. Automark: In the last three years many government departments had been conducting studies to change the policy for two wheelers. Is there any progress? Sabir Shaikh: Yes you are right. The Tariff Commission of Pakistan, Ministry of Commerce, Board of Investment
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Monthly AutoMark Magazine
Automobile inaugurating ceremony - Update
Al-Haj FAW Motors inaugurates automobile assembly plant, Prime Minister attended the ceremony “It is a great pleasure for me to see that our industrial group has started this very important automobile facility in partnership with China,” he remarked, and hoped that this project would prove a milestone for the automobile industry in Pakistan. The Prime Minister was addressing a gathering after inaugurating automobile assembly plant of Al-Haj FAW Motors Company at National Highway in the vicinity of Port Bin Qasim in Karachi. Sindh Governor Dr Ishratul Ebad Khan, Federal Minister for Defence Syed Naveed Qamar, the Chinese consul general in Karachi and a group of other provincial ministers were also present. He said Al Haj FAW Motors deserves to be appreciated for this initiative for setting up a new Automobile Assembly plant. It is more encouraging that it is a joint venture with the largest Chinese auto sector group - FAW. He said that the Al Haj FAW Motors made an investment of Rs 550 million. The plant was expected to provide employment to around 1,500 persons. He said: "There is no denying the fact that automobiles have a major share in the economic development of a country and during recent years, global and domestic auto industries have been passing through difficult times due to various factors." He said that the capacity utilisation in local heavy vehicles manufacturing segment was quite low. He expected that Al-Haj FAW Motors would take it as an opportunity to capture the local market aggressively. "Automobile sector offers immense export potential. Compliance with high manufacturing standards cannot only foster auto exports and earn precious foreign exchange, but also help Pakistan narrow down the rising trade deficit." With the launch of its assembly line, AlHaj FAW Motors said that the company is all set to significantly increase its market share in Pakistan in both trucks and pick-ups. Chairman of Al Haj Group Haji Shahjee Gul Afridi said that FAW was the largest auto sector Chinese group. "It is the
Prime Minister Raja Pervez Ashraf inspects the assembly line before inaugurating the Al-Haj FAW factory. PHOTO: PPI third largest auto group in the world, manufacturing and exporting quality vehicles across the globe." He pointed out the new plant would produce 25,000 vehicles per annum, adding that the plant''s capacity could be increased. He said that the import of used cars was negatively impacting the local industry and urged the government to ban the import of used cars. The company has already been assembling two 1,000cc vehicles at the plant since June 2012. Afridi said that his company has sold a few hundred pick-ups assembled at this plant over the last few months. Al-Haj FAW Motors – a joint venture between the largest and oldest Chinese vehicle maker First Automobile Works (FAW) Motors and Al-Haj Motors, an established commercial importer of heavy vehicles in Pakistan – has been importing completely built units (CBU) from China for the last few years. With its assembly plant in action, the company is now targeting to launch new vehicles and passenger cars of 1,0001,500cc engine capacity within the next few years. It has been assembling trucks since October 2011 and plans to produce 6,000 trucks and 12,000 light vehicles every year. However, the company’s ambitions may be tempered by the economics of demand and supply. The truck market
has slowed over the last few years in Pakistan, a representative of Hinopak Motors – the largest truck maker in Pakistan – said. Industry officials say that the decline in overall economic activity and continuous disruptions in Nato supplies to A fg ha n i st a n ha v e r es u l t e d i n significantly low sales of trucks in Pakistan. The installed capacity of Hinopak Motors is 5,000 trucks, but it produced only 1,237 trucks in fiscal 2011-12. The historical high figure of truck production in the country’s history is 4,993, achieved in fiscal year 2007-08, according to the Pakistan Automotive Manufacturers Association (PAMA). Al-Haj FAW Motors claim that they are now number two in the list of truck producers in Pakistan, assembling around 700 trucks annually in the country. However, their claim is difficult to prove as they are currently not members of PAMA –the representative body of vehicle manufacturers in Pakistan. There are four truck assemblers currently operational in Pakistan. With the addition of Al-Haj FAW Motors to that group, five truck assemblers will now vie for the Pakistani market – all operating from their bases in the port city of Karachi.....
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Exclusive Article by M. Owais Khan on cars issue
Monthly AutoMark Magazine
Ministry of Industry lobbies for cutting used car age limit to support assemblers The Ministry of Industry played a main role in secretly forwarding a summary to the ECC to fully support the local car industry. Secretary Industry Shafqat Hussain Naghmi believed that the used cars had severely hit the car assemblers and arrival of used cars up to five years resulted in idle production capacity in the industry and may affect thousands of jobs. The issue of reducing age of used car imports is again on the knife edge as car assemblers have been forcing the government to reduce the age limit to save local industry while used car dealers are trying to block this move. The Ministry of Industry has been playing a double role as it first allowed entry to used car dealers to present their view point on used car import in various meetings in the presence of car assemblers to provide benefit to the masses. However, the Ministry of Industry finally pulled back the support from used car dealers to pacify the car assemblers. While safeguarding the interest of stakeholders, the government has ignored the consumers’ interest who have been pointing out in various news papers about the role of the local car assemblers. Consumers believe that why they pay Rs 1.4 million for 1,300 car or over Rs one million for 1,000cc locally assembled car which lack features like power windows, air bags and central locking facility which are common in imported vehicles. They said that they do not get the value of their huge money which they pay to the local assemblers. More surprisingly, Pakistan Automotive
Manufacturers Association (PAMA) has prepared a list of 83 parts that cannot be localized for next five years which means that the assemblers will continue to play havoc with the prices on Rupee-Yen parity as these parts are being imported at 32.5 per cent customs duty.
The Ministry should take notice of this. Consumers said why the Ministry of Industry has not done any homework to find out slow achievement of local assemblers for localization of parts and it also has yet to check the price increase made by the local assemblers on rising cost of imported parts. In all the efforts no one is bothered to review the consumers’ angle whether they are benefitting from the existence of local industry as they have only one choice now in 800cc model (Suzuki Mehran) and in 1,000cc (Suzuki Cultus) after the suspension in production of Daihatsu Cuore and Suzuki Alto few
months back. Last month the Economic Coordination Committee (ECC) set up a committee headed by Deputy Prime Minister and senior Industry Minister Chaudhry Pervaiz Elahi to review possibility of reducing age limit of used cars to three from five years on the assumption that the industry is suffering due to influx of used cars. The Ministry of Industry played a main role in secretly forwarding a summary to the ECC to fully support the local car industry. Secretary Industry Shafqat Hussain Naghmi believed that the used cars had severely hit the car assemblers and arrival of used cars up to five years resulted in idle production capacity in the industry and may affect thousands of jobs. To make its case, the Ministry of Industries has made a selective comparison of prices of imported used cars and locally-assembled cars in its summary. It complained that an imported Suzuki Alto is available at Rs750,000 compared to a locallyassembled Suzuki Mehran, which costs a lower Rs607,000. However it said nothing about the relatively low production quality of the Mehran against the better quality Alto. Similarly, it said that the imported Toyota Fielder is available for Rs1.55 million, against the Corolla GLI which costs Rs1.82 million. The ministry claimed that due to the relaxation in the age limit for imported cars during the last fiscal year, 56,973 used cars were imported which account for nearly 37 per cent of local production. It added that when the minimum age limit was three years in fiscal 2010, car imports stood at only five per cent of local production. In another development, the Ministry
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Monthly AutoMark Magazine
Exclusive Article - continued
An environment of competition should be created and the used car import policy should also be revisited to provide a level playing field for all stake holders and most importantly allow the Pakistani consumer the right to purchase a vehicle of his choice and within his means. Shafqat Hussain Naghmi.
The Industry Secretary paid visit to the Indus Motor Company (IMC) and Pak Suzuki Motor Company Limited (PSMCL) followed by visit of some closed vending units to ascertain the impact how industries are operating under negative repercussions of used cars import. The secretary said that import of used cars is for overseas Pakistanis but it is being misused. The industry and the government need to devise a mechanism to stop this abuse. H e s a i d t ha t i n d u s t r y n e ed s government’s support to offset impact of used cars but cert ainly the government cannot give overprotection to the industries. He assured the stakeholders that he would convince the higher ups on used car issue. It seems that Mr Pervaiz Ilahi was unaware of the Cabinet Division’s letter sent to Ministry of Industries on October 10. The Cabinet Division, while referring to the Industry Ministry’s summary to the Economic Coordination Committee (ECC) on October 1, 2012 on the subject import policy of used cars, said that under the Rules of Business, 1973 the matter discussed in the summary does not fall in the domain of the Industry Ministry as is evident from the business allocated to that Ministry under the Rules of Business 1973. Previously summaries on the subject, submitted by the erstwhile Ministry of Industries and Production, were accepted by the Cabinet Division mainly because at that t ime Paki st an Automobile Corporation etc were under that Ministry. After bifurcation of erstwhile Ministry of Industries and Production, the Pakistan Automobile Corporation has been allocated to the Ministry of Production. The Cabinet Division said that nevertheless being an
important policy matter, it relates to the Commerce Ministry which previously issued the necessary notification. As such the summary is required to be submitted by the Commerce Ministry. The Ministry of Industry while taking feedback from the used importers presented a different summary to the ECC on October 1 by supporting the local industry. The Commerce Ministry, in view of ECC’s meeting held on January 26, 2011 issued a notification on February 8, 2011 thus raising the age limit of used cars from three to five years aimed at creating a healthy competition and rationalize prices of locally assembled cars. However, the desired results could not be achieved due to price of imported cars being slightly less than similar locally made cars. All Pakistan Motor Dealers Association chairman H.M. Shahzad has presented a paper to the Industry Ministry on a u t o m o b i l e i n d us t r y a n d i t s performance in the area of localization and inter alia bring to fore the gross violations and misuse of facilities provided under the government’s Progressive Manufacturing Policy for automobiles. This defeated the main objective of supplying affordable cars for the Pakistani consumer in an environment of monopoly and cartel created due to the extensive protection and incentives.
Deletion Program Under this policy, the automobile industry was to promote indigenization of vehicles and their components. Indigenization of production was based on two different types of deletion plans – the Industry Specific Deletion Plan (ISDP) and Product Specific Deletion Plan. The assemblers were supposed to
set annual targets for each assembled vehicle under these deletion plans and the Engineering Development Board would conduct annual audits to assess the achievements of assemblers under these deletion plans. During this period the industry was supposed to address several objectives like developing products at low cost, achieving economies of scale, acquiring technologies t hro ugh technical collaborations and developing and improving the quality of products. The above was to be achieved under the aegis of the afore mentioned deletion program which required that the company would enter into a transfer of technology agreement with their principals and localize complete vehicle within 5 years. During this period extra ordinary incentives were given to the assemblers; the duties on import of parts were substantially reduced and import duties on CBUs were enhanced. These facilities are in vogue even today.
Achievements of local industry Needless to say, that Suzuki has now been in business for 30 years while Toyota and Honda for 20 years but the low cost People’s car is still a dream. Th e t ime l imi t s go t e xte nd ed innumerable times on one pretext or the other but without any progress. During all this time these OEMs continued to enjoy the facilities provided by the Government at the expense of the consumer. Except for Suzuki which has carried out some tangible deletion in their 800cc models, the other two assemblers have made no noticeable achievement. However, none of them have made any progress in localization of engine, transmission or electrical components/assemblies. The last nail in the coffin is the Tariff Based System (TBS), under which parts are freely importable from any country. This TBS was a big mistake as it has completely de-motivated the assemblers from any little intention they had for deletion and thus has given impetus to a continuous price hike of locally assembled cars.
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Comparison of local vs. used car sales The allegation that used car import is the cause for low sale of local cars is a complete falsehood and an attempt at masking the realities. The local assemblers have shown good results for the last 3 years consistently and also for the period Jan to June 2012. It is only in the third quarter 2012 that the sales have dropped. The main reason for this is closure of sales of CNG vehicles by the Government which accounted for bulk of the production of local cars especially Suzuki. Furthermore, sale of Suzuki Alto and Daihatsu Cuore was stopped without introducing any new model. Both these products accounted for at least 25,000 to 30,000 in sales. These are the two most important factors for the drop in sales during last four months. There is no effect of any other factor. The table below shows that during the period from 1994 to 2004, the used car imports were negligible but the local cars failed to derive any benefit from it.
capitalize on the years when there was a near monopolistic market situation prevalent even today when all CBU imports (used or new) were disallowed by the Government. That was the time for consolidating deletion and lowering prices.
Market demand of vehicles It may be added that the annual demand of automobiles has never been properly established but a fair estimation puts it close to 500,000 vehicles of all categories. Local production is about 150,000; CBU imports (used and new) are about 50,000.The rest of the transactions are taking place in sale/purchase of old vehicles which include vehicles as old as 35 years. A survey of the on-road cars and “car mandis” will verify this claim. These vehicles are a safety hazard. We believe it would be prudent to replace these worn out gas guzzling scrap vehicles with imported cars 5 to 10 years old which are in good condition and not an eye sore. Therefore there is ample opportunity for increasing production capacity and sale of local cars.
Price hike and black marketing As far as prices are concerned, they have been increased indiscriminately in the last 4 years by more than 100 per cent taking the excuse of currency devaluation which has not increased by more than 50 per cent. Consumers often have to wait for months before receiving new cars. The carmakers have been announcing plans to increase production volumes over the years but these plans have yet to come to fruition and late delivery and high premiums on locally assembled cars re mai n t he maj o r so ur ce s o f dissatisfaction among buyers. With the reduction in production figures recently announced by the major manufacturers, the situation is not expected to improve in the near future.
Black marketing or premium or “On Money” is the rule of the day. This was not possible if there was no demand. In fact, production is deliberately kept low to keep the market starved and promote black marketing and increase prices.
Used car import policy – a means to break the monopoly Due to the rising prices of the cars in the domestic market, the government has allowed the import of used cars up to 5 years old under Transfer of Residence and Gift Schemes but there is the necessity to allow import of cars used for up to ten years to further bring down the prices and set up an environment of competition in the domestic automobile market. It may be seen that there is virtual monopoly of local assemblers in the market. For example, in the category of 800cc only one car is available. Similarly, in 1000cc, 1300cc, and 1500cc only one or two cars are available. There has been constant pressure from automobile manufacturers to ban the import of used cars completely. They said that the ban will help local manufacturers to boost sales and when volumes grow the production cost will go down, thus benefiting the end user. And they have been successful in one or the other way to restrict the import of used cars. The Federal Board of Revenue had reduced the depreciation rate from 2 to just 1 per cent on the import of used cars. This decision to make 50 per cent reduction in depreciation rate increased the overall rates of duties and taxes on the import of old and used vehicles. However, the assemblers have failed to bridge the gap between supply and demand especially of the small car category which is in higher demand. This is also proved by the table shown above and it must be taken into account that for more than half the period since the inception of the local industry 30 years ago, the import of cars of all types has remained banned. But, there has been no breakthrough in localization of parts or any reduction in prices.
Some suggestions
Source: APMDA
The table clearly shows that local car volumes are not a factor of used car sales. In fact, sales were dependent upon mar ket fo rces and pr od u cti on /marketing policies of the assemblers alone. The local industry failed to
The assemblers must be asked to show what they have achieved in 30 years in a real cartel environment in terms of localization or stabilization of prices. Their profits, dividends, and remittances should also be scrutinized. If the government wants to curb black
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Monthly AutoMark Magazine
Automotive Sector - Update
Auto parts makers want a decade to compete with India Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) said that after the signing of recent agreements between India and Pakistan to answer non-tariff barriers (NTBs) in India, auto parts makers still believe they need more time to gain strength to compete India’s strong auto industry. “Local auto parts makers are still a nascent industry. And, they will be hurt significantly if Pakistan allows liberalisation of trade with India in the near future,” Paapam Chairman Munir Bana said while speaking to media. The newly appointed chairman said that the government should maintain a sensitive list with India for at least 10 years before considering any reduction in tariff lines. The demand for more time, from Paapam, comes at a time when Pakistan is expected to abolish the negative trade list with India by end of this year. Auto industry – a leading industry of Pakistan – had strong reservations in this regard. Paapam in a press release on Monday also said that Pakistan’s auto industry was not prepared for phasing out the negative list.
There is ambiguity surrounding this because it will be very difficult for both governments to establish whether all the NTBs had been removed before Pakistan phases out the negative list in the next two months. Right now, both governments were collecting data regarding the complaints on NTB’s, which obviously takes time. In response to a question, Bana said that NTBs was a big issue because the complainant will have to prove government that the local industry had direct repercussions with trade liberalisation. Indian High Commissioner to Pakistan S h ar a t S a b h ar w a l t a l k i n g t o businessmen in Karachi earlier said that his government would do everything possible to remove the concerns of Pakistani businessmen regarding the trade barriers. Despite reservations from auto sector, the stance of the government was clear that the negative list will be phased out by December 31, 2012. Auto Industry analysts say that auto parts makers were more vulnerable than the automakers like Pak Suzuki, Indus Motors and Honda....
Bana Paapam new chairman, Usman vice chairman Pakistan Association of Automotive Parts & Accessories Manufacturers (PAAPAM) has elected Munir Karim Bana, Chief Executive of Loads Limited, as its new chairman and Usman Malik as Vice Chairman for the year 2012-13. The Chief elect ion commission Muhammad Saleem made announcement in this regard at the 13th Annual General Meeting of the Association. In addition, Aslam Rayaz, Muhammad Wasim Khalid, Agha Qasim Raza, Mashood Ali Khan, Taufiq A. Sherwani, Ahmer Afzal Khan, Mirza Shafqat Sohail, Mehmood Alam Sherani, were elected members of the Managing Committee. Earlier Syed Nabeel Hashmi, the outgoing Chairman, highlighted the events and activities undertaken by PA APAM du ring last year. He congratulated Munir Karim Bana and Usman Malik on their election as chairman and vice chairman. He welcomed the newly-elected Managing
Committee and said that he and his team had tried to resolve auto industry issues to a great extent but challenges still remained, particularly on burning issues such as import of used cars, non-implementation of Auto Industry Development Programme (AIDP), etc. The newly-elected Chairman Munir Karim Bana and Vice Chairman Usman Malik thanked the outgoing chairman and appreciated the work done by the prev ious Managi ng Committee. He stressed the need to overcome the numerous challenges faced by the auto industry and assured the members that the new Managing Committee will continue working as a vibrant and active body, in spite of a very difficult economic environment and many hurdles faced by the industry.
Autoparts-makers fetch big orders The Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) is seriously looking for joint ventures and trade agreements for development of engine and high-tech consumable parts for aftermarket and OEM consumptions. “We are seeking technical collaboration with international companies for hightech auto parts manufacturing in Pakistan,” observed Munir K. Bana, the Chairman of the PAAPAM. Briefing the managing committee about PAAPAM dele gation vis it to Automechanika 2012 Frankfurt, the newly-elected chairman said the association was looking forward to developing contacts with international manufacturers, besides analysing possibility of joint ventures with them. He added that delegation had visited the exhibition to study world automotive industry and introduce its members to international markets and build up their businesses keeping in view global economies and scales. The delegates, out of which 26 were exhibitors, participated in the show under the PAAPAM banner, fetching big orders worth of millions of dollars as follow-up of the event, he added. He said that delegation studied and calculated their potential at the mega event, adding that the association also met with different international counterpart associations, fair organisers and major technology and raw material providers during the event. Addressing the meeting, vice chairman Usman Malik said that Automecanika Frankfurt is the largest exhibition of Europe for auto parts and caters entire European market. “We plan to enhance our exports and exceed $120 million barrier (current share of the sector) this year,” he added. He s aid t hat the de legat i on ’s p art i cip at i on was p art of t he association’s strategy to introduce international markets to its members, providing them an opportunity to forge new alliances and business ventures, besides introducing world a true commercial and manufacturing diversity of Pakistani companies. The PAAPAM also holds such mega exhibitions in Pakistan. In October 2011, it had arranged Pakistan Auto Show 2011 successfully in Lahore.
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Automotive Sector - Update
Monthly AutoMark Magazine
Diamond Tyre Limited Participated at Afghan Expo in Afghanistan
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PAKISTANI BRAND MOTORCYCLES
70cc Motorcycle
Sr./ No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22.
Product & Model Name Aan AI-70 Asia Hero AH-70 Bionic AS-70 Crown Lifan CRLF-70 Challenger BA-70 Diamond SD-70 Dhoom YD-70 Eagle DG-70 Ghani GI-70 Grace CT-70 Hero RF-70 Hero RF-70 Plus Habib HB-70 Hi-Speed SR-70 Jinan JN-70 Leader LD-70 King Hero KH-70 Moon Star MT-70 Master MD-70 Metro Dabang-70 New Asia NA-70 Pak Hero PH-70
Retail Price Rs. 42,500/= Rs. 42,500/= Rs. 42,000/= Rs. 42,000/= Rs. 41,000/= Rs. 42,500/= Rs. 49,000/= Rs. 41,500/= Rs. 45,000/= Rs. 42,500/= Rs. 46,000/= Rs. 47,000/= Rs. 42,500/= Rs. 43,000/= Rs. 42,500/= Rs. 42,500/= Rs. 42,500/= Rs. 42,500/= Rs. 42,500/= Rs. 46,000/= Rs. 41,500/= Rs. 42,500/=
Sr./ No. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44.
Product & Model Name Raftar KM-70 Ravi Premium R1 Ravi Hamsafar-70 Road Prince RP-70 Royal Star RS-70 Royal RL-70 Racer AS-70 Safari SD-70 Sakai SK-70 Sitara GT-70 Sohrab JS-70 Sonica SM-70 Super Asia SA-70 Super Star SS-70 Super Power SP-70 Super Power Delux Toyo TG-70 Target TT-70 Unique UD-70 Union Star US-70 United US-70 Zxmco ZX-70
Price updated July-2012 www.automark.pk | Nov-2012 | Page 32
Retail Price Rs. 42,000/= Rs. 47,700/= Rs. 46,200/= Rs. 42,500/= Rs. 42,000/= Rs. 42,500/= Rs. 42,000/= Rs. 40,000/= Rs. 45,50/= Rs. 43,000/= Rs. 44,500/= Rs. 42,400/= Rs. 43,000/= Rs. 42,500/= Rs. 42,500/= Rs. 45,000/= Rs. 42,500/= Rs. 40,000/= Rs. 42,500/= Rs. 42,500/= Rs. 42,500/= Rs. 42,500/=
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Exclusive Article by Asif Masood
Monthly AutoMark Magazine
Mass Transit & Soaring Car Culture Chief Minister, Punjab Mr. Shahbaz Sharif has diverted funds towards the projects aimed at improving the living standard of the common man and provision of amenities to the neglected masses. Metro bus service is major project of mass transit in Pakistan.. Preamble “Yesterday is not ours to recover, but tomorrow is ours to win or to lose” You must have witnessed on working days morning, neatly dressed men & women stand along the roads waiting impatiently for public transport like wagons, minibuses. The nervous look on their faces asserts the fact that this is an indispensable mode of transport in all our urban centers, as buses and minibuses are only form of mass transit available. Mass transit comprises all transport system in which passengers do not use their own vehicles. Generally, it comprises of Rail & Bus services. It also include airlines, Ferries, taxicabs etc, or any system that transport member of general public or the masses, in more tangible terms it means safe, clean, efficient, better, sustainable and affordable, on time transport to all especially the poor and which can also improve the environment. The growth of the country has been accompanied by rising urbanization, higher incomes and affluence, and an increase in the private ownership of motor vehicles. In the absence of any urban transport policies and sustained investments in public transport, most urban citizens rely either on their private motor
The Provincial Development Working Party has approved funding for six development schemes for the Punjab, including Rs3,156.632 million for the Metro Bus Service. The money will be spent on building escalators and platform screen doors at bus stops, according to the title of the project.
vehicles or the informal transport sector for urban transport.
Economic Role of Mass Transit Transport System has always played an important role in the development of economics of the country. There cannot be two views on the fact that efficient, reliable, affordable movement of People & Cargo is basic & fundamental to economic prosperity. Public Transport provides people with mobility, access for employment, Medical care and recreational opportunities to the masses. Mass transit provides benefits to those who choose to ride & also to those who have no other choice. Public transport
also helps the people to expand business opportunities, reduce sprawl and cr ea t e se n se o f community. It also enhances safety & security in society. Asif Masood Most public transport runs to a scheduled timetable with the most frequent services running to a head way.
Pakistan’s public transport sector is also in a state of anguish. The public transport is mostly operated by private operators, who compromise on the safety and comfort of the public. The daily commuters face great hardships due to poor quality of service, substandard vehicles. Government has very limited control over these bus operators. There is no ticketing/pricing mechanism prevail in our cities. The buses used are more than 20-25 years old & running on diesel and emitting visible black smoke. These buses also do not use the designated bus- stops to pick and drop to commuters, which hinders traffic flow. The number of these buses is inadequate to meet the demand of daily commuters.
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Monthly AutoMark Magazine
Chief Editor, Monthly AutoMark Magazine Mr. Hanif Memon has shared his experience of his visit to China in October 2012, regarding importance of mass transit. At present, there are mainly four types of public transports available for commuters in China i.e subway, light rail train, Bus Rapid Transport (BRT) and normal buses. Pakistan’s Misery for 8000 Green Buses for Major Urban Cities In Pakistan, the public transport system is largely owned and operated by the private sector. The government, which is the regulatory body, has been trying to tackle the transport problems in the country, which can be characterized by the growing number of private vehicles, seri ous cong esti on, i nef f ecti ve enforcement and lack of sufficient infrastructure in terms of both quality and quantity. The Government has introduced a wide range of strategies, including those for vehicle emission control and ambient air quality. Introduction of 8000 CNG buses in ten major cities, was a practical example of a serious effort for Mass Transit Program, where the government supported with Rs 5 billion cash grants and sharing loan payments, but the federal bureaucracy put the plan in trash.
The Sindh government has in principle decided to bring at least 500 diesel run buses, instead of 1,000 CNG buses for the metropolis, long-pending multi-billion-rupee Shaheed Benazir Bhutto Transport Programme. The Rs 2.5 billion project was announced by the federal government in 2006-07. It was delayed because of the lack of interest on part of the government. Under this project, some 500 CNG buses were to be brought on road in Karachi by February 2008, while at least 1,000 buses were to be introduced in the entire province. As many as 600 buses were to run on different inter-city routes, 100 on Karachi-Sukkur, 100 on Karachi-
Hyderabad and 50 each on KarachiLarkana, Khairpur-Benazirabad and Mirpurkhas routes.
will eliminate passengers’ sense of depression when enter.
Mass Transit in China
The urban transport system is constrained by insufficient financial resources, inefficient regulatory frameworks and poor allocation of road space, inadequate traffic management systems, institutional weaknesses, and underdeveloped public transport systems. In particular, poor traffic management, one of the biggest issues of Pakistan, is due to a combination of many factors: • lack of coordination and overlapping respo nsibili ti es amo ng v ar iou s Government agencies. • Insufficient traffic police and traffic signals. • Flaws in traffic markings, and ineffective enforcement of traffic rules and regulations. Road crashes are common due to poor traffic management, undisciplined pedestrians and the many types of vehicles using the roads. Poor traffic management has also resulted in encroachment by parked vehicles and commercial activity on roads, thereby reducing road capacity, and causing inadequate public transport services. The situation has been aggravated by the fact that nearly 90% of city land is under the ownership of various public institutions, each of which has authority over land use and planning with regard to its own land. Low Carbon Economy The problem directly associated with the road transport sector is its contribution to air pollution. Owing to the high proportion of old and un-tuned engines and the dependence on buses
Chief Editor, Monthly AutoMark Magazine Mr. Hanif Memon has shared his experience of his visit to China in October 2012, regarding importance of mass transit. At present, there are mainly four types of public transports available for commuters in China i.e subway, light rail train, Bus Rapid Transport (BRT) and normal buses. They have advantages and disadvantages for example, subway cost a lot and takes long time to build, BRT takes up road spaces and produces noises as well as pollution in the air. Now they are developing a unique form of mass t ransi t which will be environmental friendly public transport, a straddling bus. The straddling bus combines the advantages of BRT, it is also a substitution for BRT and subway in the future. The majority of vehicles on the roads are cars. Normally in China are over passes about 4.5-5.5 m high. The highlight innovation of straddling bus is that it runs above car and under overpass. Its biggest strength is saving road spaces, efficient and high in capacity. It can reduce up to 25-30% traffic jams on main routes. Running at an average 40 km/h, it can take 1200 people at a time, which means 300 passengers per cart. Another strength of straddling bus is its short construction life cycle, only 1 year to build 40 km. Whereas building 40-km subway will take 3 years at best. Also the straddling bus will not need the large parking lot that normal buses demand. It can park at its own stop without affecting the passage of cars. it has huge skylight that
Key Challenges
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Exclusive Article by Asif Masood - continued hand light commercial vehicle in metropolitan areas, air pollution along busy roads is greater in magnitude that would be expected for the number of vehicles on the road. Air pollution is caused by suspended particulate matter, sulfur dioxide, carbon monoxide, nitrous oxides and lead. Motor vehicles account for 90% of tot al emi ssions of hydrocarbons, aldehydes and carbon monoxide in cities, and for three-fourths of all sulfur dioxide and nitrogen oxides. The suspended particulates in air causes lung initiation, sinus problems, bronchitis and asthma, whereas lead emitted by gasoline vehicles causes liver disinfection and impairment of mental health.
Improving Vehicle Fuel Efficiency Regulations to be put in place to discourage fuel in-efficient cars. Carburetor-based vehicles should be phased out and local producers should be mandated to meet minimum efficiency standards set by the government over the next 3-5 years. Plan to phase out 2-stroke rickshaws should remain in place and reinforced more diligently. The vehicle pollution problem is further compounded by the fact that the old model automobiles which have completed that lifetime are in use as the people lack enough
The waiting game has started and who knows when it will end. No train, no passengers, no work for the boys in red marketing in the interest of the customer, local cars booked in the name of a customer should also be made nontransferable for one year as often advocated by various quarters. The used car trade may be brought under the regulations of normal commercial imports which will curb mal practices and help in documentation of the industry. Used or new car imports should be allowed from any country where right hand drive cars are manufactured such as India which will help in further reduction in prices and
resources to buy new automobiles and the country cannot afford to spend foreign exchange for this purpose. Such automobiles are not only energy inefficient, rather these emit more hazardous gases than the standards established by the auto industry. The air pollution caused by diesel engines is very high. Thus there is a link of poverty with the degradati on of urban environment. Above all, the lack of awareness/ education among mechanics and automobile owners about vehicular pollution is the major impediment in improving urban air quality.
Metro Bus Service in Lahore - A New Initiative Chief Minister, Punjab Mr. Shahbaz Sharif has diverted funds towards the projects aimed at improving the living standard of the common man and provision of amenities to the neglected masses. Metro bus service is major project of mass transit in Pakistan. While reviewing development projects at Minar-e-Pakistan camp office Chief Minister said “completion of metro bus service would result in speedy transport facilities to the masses besides giving a new identity to the City�. The project would be completed as early as possible by working round-the-clock.
The pictorial Story of Pakistan Railway
The Mazar-e-Railway. No trains, no passengers by the courtesy of Railway Minister benefit the consumer.
Conclusion In conclusion, it is requested that the government should subject the local industry to strict accountability for their failures of the last 30 years and once again revive and strictly enforce the deletion program to realize the requirement of low priced cars for the Pakistani consumer. An environment of competition should be created and the used car import policy should also be revisited to provide a level playing field for all stake holders and most
Monthly AutoMark Magazine The Pakistan Railways seems to be speeding on a downward track by the solely effort of Mr Ghulam Ahmad Bilour, Minister for Pakistan Railway.
He has often been criticized for his gross incompetence, coupled with extreme arrogance as a Railway Minister. He was once quoted as saying, "Afghanistan and Saudi Arabia do not have Railways, why Pakistan should have it? Some people even think that Ghulam Ahmad Bilour is actually bent upon destroying Pakistan Railways with the connivance of Transporter Mafia in Pakistan. Those who take the train are considered by those who have never seen the inside of a train carriage to be cattle, and since cattle are never in a hurry to get anywhere except to the abattoir, it does not matter if their 24 hour journey takes 76 hours. The non-cattle variety shuns the rail and travels by air only to sometimes find their cocoon crashing head-on into the Margalla Hills or plunging to the ground in a ball of fire. It is a not so subtle reminder that when the malaise of mismanagement, corruption and sheer indifference spreads, it makes no distinction between sheep and humans, trains and planes.
When will the train leave and when will they get home? God only knows! importantly allow the Pakistani consumer the right to purchase a vehicle of his choice and within his means.
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Car / Light Vehicle Price List
SUZUKI Model Model MEHRAN VX 800cc Euro II MEHRAN VXR 800cc Euro II SUZUKI SWIFT 1.3L DX SUZUKI SWIFT 1.3L DLX SUZUKI SWIFT 1.3L Automatic CULTUS Efi VXRI Euro II CULTUS Efi VXRI (CNG) LIANA 1.3L RXI MT PETROL LIANA 1.3L RXI MT (CNG) RAVI PICKUP VX Euro II RAVI PICKUP ST308R VX CNG BOLAN VAN VX Petrol Euro II SUZUKI VAN CARGO Euro II APV 1.5L GLX MT (Petrol) APV 1.5L GLX MT (CNG) JIMNY JL SX MT JIMNY JL DX MT)
HONDA Price Price Rs. 575,000 Rs. 632,000 Rs. 1,151,000 Rs. 1,231,000 Rs. 1,366,000 Rs. 985,000 Rs. 1,382,000 Rs. 1,461,000
Model CRV Automatic 2400cc Japan Accord Automatic 2400cc Japan City Manual 1300cc HYUNDAI City Prosmatec 1300cc Civic VTI Manual 1800cc Civic VTI Manual SR (Oriel) Civic VTI Prosmatec 1800cc Civic VTI Prosmatec SR (Oriel)
Price 7,117,000 6,617,000 1,497,000 1,638,000 1,851,000 2,043,000 1,971,000 2,121,000
Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
TOYOTA COROLLA Rs. Rs. Rs. Rs. Rs. Rs.
654,000 630,000 2,099,000 2,174,000 1,074,000 2,223,000
Karakoram Motors Model Chery Standard Petrol Chery Standard CNG Chery Deluxe Petrol Chery Deluxe CNG Gonow Victor Gonow Troy Standard Gonow Troy Deluxe Gilgit (Double Cabin) Pet. Gilgit (Double Cabin) CNG Kaghan XL Petrol Kaghan XL CNG
Honda Honda Honda Honda Honda Honda Honda Honda
Price Rs. 7,20,000 Rs. 7,70,000 Rs. 7,70,000 Rs. 8,20,000 Rs. 1,499,000 Rs. 9,99,000 Rs. 1,049,000 Rs. 3,85,000 Rs. 4,20,000 Rs. 1,285,000 Rs. 1,375,000
Model Model XLI VVT-i 1.3 M/T 1299cc Petrol GLI VVT-i 1.3 M/T 1299cc Petrol GLI VVT-i 1.6 A/T 1599cc Petrol XLI VVT-i 1299cc ECOTEC GLI VVT-i 1299cc ECOTEC 2.OD STD 2000cc 2.OD SALOON MT 2.OD SALOON SUNROOF ALTIS 1.6L Dual VVT-i MT ALTIS 1.6L Dual VVT-i MT SUNROOF ALTIS 1.6L Dual VVT-i AT Cruisetronic ALTIS 1.6L Dual VVT-i AT SUNROOF Toyota Avanza (Standard)
Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Toyota Avanza (Up Specfication)
Rs. 2,160,000
Price Price 1,537,500 1,672,500 1,827,500 1,602,500 1,732,500 1,607,500 1,809,000 1,914,000 1,902,500 1,997,500 1,997,500 2,087,500 1,960,000
Hilux Pickup 4x sc Model
Price
Brand New Toyota Hilux Pickup, 4x2, Single Cabin, (Local Assembled)
Rs. 1,763,500
Hilux Pickup 4x4 D/C Model
Price
Toyota HILUX 2494cc, Diesel Turbo Charger Common Rail Engine, 4x4 Double Cabin - Standard Model
DAIHATSU
Price TOYOTA VIGO Model
Rs. 2,878,500
LAND ROVER Model
Price
Vigo Champ M/T Rs. 3,178,500 DEFENDER (WHITE ,BLACK,STRONG BLUE & SILVER ) STATION WAGON 90 Rs. 3,560,000 STATION WAGON 110 Rs. 4,260,000 Vigo Champ A/T Rs. 3,378,500 Soft Top 90 (N/A) (WHITE ,BLACK,STRONG BLUE & SILVER )
Price updated Oct- 2012
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CIMAMotor-2012 - Exclusive after event report
Monthly AutoMark Magazine
CIMA 2012 breaks all records October 11, 2012 -14 days, China's largest professional motorcycle exhibition - The 11th China International Motorcycle Expo (CIMAMotor 2012), held in Chongqing International Convention and Exhibition Centre, attracting 130,000 visitors view exhibitions. Chongqing is an industrial city in southwest China. It’s primarily known for its production of motorcycles and cars, and I'm told it’s the world’s largest producer of lapt op comp uters. It’s said that the city got its start as a production center during WWII when it was the capital of Nationalist China. U.S. Gen. “Vinegar” Joe Stillwell, as legend goes, felt that the Chinese needed to develop their own manufacturing capability in order to defeat the Japanese, and helped the Nationalists start their first factories; these became the basis of Chongqing’s manufacturing prowess. There’s a monument in town honoring Stillwell’s contribution. The show opened with speeches by the mayor and a variety of industry dignitaries. According to my translator, most of them covered the same ground, welcoming people attending the show, and citing the significance of the event and its impact on the city. As soon as the doors opened the main hall was flooded with people. It’s hard to believe they were all press, dealers and members of the trade, but on the other hand this is a country that retails about 12 million motorcycles annually, so it’s possible that everyone was legit. According to statistics, the Chongqing Mobo will be a blend of 400 companies around the world, the 7000 domestic vehicle and 1000 spare parts dealer, on behalf of the Chinese motorcycle manufacturing capacity of more than 90% of the industry exceeded 60,000 square meters, the exhibition scale, attracting a total of 130,000 visitors the show. The first day the CIMA show was open to the public, I expected that the halls would be filled beyond bursting, but that wasn’t the case. There were very few attendees, a lot fewer than yesterday's pre-showing. But this worked out well as it enabled journalists to photograph displays and a few motorcycles without
the competition from the multitude of cell p h o n e photographers. CF Moto displayed a solid looking ATV and UTV, as well as an attractive 650 cc tourer. M o s t inte r na tional trade shows devote the first day or couple of days to an exclusive viewing by journalists, dealers and members of the trade, thereby giving them an opportunity to look closely at new products and place orders without crowds. CIMA follows the same procedure, except that it didn’t appear that anyone was taking orders. A lot of people just appeared to be spectators, making photography and conversations difficult. With fairly strong domestic manufacturers, it would be assumed that Chinese companies would dominate their home show, but with few exceptions the biggest exhibits and those attracting the most attention were Honda, and those companies with either partnerships or subsidiaries of Japanese or European manufacturers: Hajue/Suzuki,
Oct 11 - 14 , 2012 Chongqing, China
Zhejiang Qianjiang/Benelli, Loncin/Kawasaki, Jianshe/Yamaha and Zongshen/Piaggio. Standalone domestic manufacturers with a strong presence were CF Moto (which I was told is not strong in China but has a lucrative export business) and Lifan. There were a few others as well, but with very small displays and equally small product offerings. Harley-Davidson had a well laid out, though not large, display and will be opening a new dealership in Chongqing Oct. 12. The Motor Co. has been in the market for about 10 years; it's taken a slow and studied approach and has about 12 dealerships in-country. One of the problems facing Harley, as well as other large displacement recreational motorcycles, is the fact that 97 percent of the motorcycles sold in China are intended for utilitarian purposes. (This fact was brought home on my way from the airport: We passed any number of motorcycles so piled with boxes or other cargo that it was impossible to see the rider from the back, and one rider rode using his left hand to hold an umbrella that would shield him and his goods.) China’s OEs are at a crossroad. Declining
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CIMAMotor-2012 - Exclusive after event report
Monthly AutoMark Magazine
Interview with Wang Wei (Director of CimaMotor)
A press conference presided by Mr. Wang Wei, CEO of CIMAMotor 2012, was held in the afternoon. Wang was very open about the problems with CIMA this year, and some of the problems confronting Chinese OEs in general. Wang Wei is Director CimaMotor already accounted for 11 editions streak, surpassing every year in number of brands and audience. His great love for motorcycles has prompted this room as the most important in Asia and, t he re fo re , h as co n t ri b u t e d t o strengthening the CimaMotor Chinese industry making them aware of their ov ersea s d ev elopments bot h manufacturers and auxiliary industry. The great growth that begins to look at the large displacements has encouraged fo re i gn br an d s t o p ar t i ci p at e increasingly in use as CimaMotor to showcase their products to the Chinese market. sales in domestic and overseas markets are causing them to rethink their strategies. It’s no longer sufficient to be the cheapest product out there; even emerging countries are demanding better quality, service and parts backup. There’s also the notion that in order to make headway in the world market, China needs to shift focus to larger, 600cc-plus motorcycles and compete head-to-head with Japanese and European products. CIMA's second hall is primarily for the aftermarket, with a few secondary OEs. On display are instrument panels, cranks, cams, electrical connectors, various speedometers, tachometers and other instruments. Hundreds of petcocks, clutch plates stacked like hotcakes at IHOP on a Sunday morning,
Speaking through a t r an s la t or , Wan g s ai d exhibitor participation is down 22 percent from last year, and first day purchaser and vendor attendance also dropped, although a specific number wasn’t given. On the upside, there were more riders (read: consumers) present. But a trade show’s success depends on exhibitors and buyers, and the dealers and distributors were in short supply. Has seen how public participation and trademarks in this last CimaMotor issue? This year has been an increase in the number of visitors. More and more "bikers" in the corridors of CimaMotor and that is good because it increases the love of the bike. At the level of participation of brands, you can also check growth and especially foreign firms. Even compared to previous editions, exporters repeat, HarleyDavidson, for example, have increased by 50% the area of your booth. How Chinese is the average user? The Chinese market is attent ive to developments. It's going to use the bike as a daily tool to move to a more playful. The user enjoys the bike and therefore are beginning to develop rapidly in China and larger displacement bikes more leisure oriented to daily use. An example, that sales of motorcycles "big" in China have increased by 100%. but very little in the way of outerwear, helmets, gloves, aftermarket exhausts, tires, lubricants and other items of which dealers stock their shelves. It appears that while the first hall is dedicated to the needs of dealers in terms of basic motorcycle product, the second hall is geared more for small OEs who want to build a motorcycle from the ground up. Outside the exhibition hall there were test rides, and retailers selling motorcycles to consumers, unlike the U.S. where they would be selling clothing and gear.
VIP service available for the China International Motorcycle Exhibition....
"Wang then predicted that by 2015 China will become the world’s biggest market for large displacement motorcycles, sustaining a 120 percent growth rate over a period of time." Europe is mired in a deep crisis, the crisis is affecting China? In China, people are increasingly rich, wealth increases here very quickly. After buying a house and a car, many people think about buying a motorcycle. It is estimated that China will grow 20% in sales of motorcycles over 250 cc and it is expected that by 2017, China will have the largest big bike market. Logically in exports is feeling the crisis. In the first eight months of 2012 have been exported 5.38 million motorcycles, representing 89.5% over the figure for the same period last year. But is compensating exporting to developing countries in need of getting a bike for mobility.Also keep in mind that many Chinese brands have factories and elsewhere: Jialiang in South Africa, Brazil Zongshen, Lifan in Turkey, Vietnam and Iran, ... How is the technological level of Chinese industry bike? Largest and most important Chinese factories have a high technological level. They have evolved a lot in the last five years and believe we are on the first level worldwide. How does the electric bike in China? The electric bike is not a leading manufacturer.The difference in weight and speed with conventional do not give them much importance. The electric bikes in China do not need a license to drive them and not exceeding 50 km / h. With few exceptions, the major motorcycle factories in China are not very interested in this type of motorcycle. Will we see a future MotoGP team 100% Chinese? Honestly do hope that in the near future there is a Chinese race bike ridden by Chinese pilots, at least make it competitive. On a recent trip to the States I was surprised to see how children learn to ride a bike and are very young. Here in China, not normally seen. The culture of the bike is more like commuting use and not as athletic.....
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Oct 11 - 14 , 2012 Chongqing, China
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Oct 11 - 14 , 2012 Chongqing, China
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China Automotive Industry - Update
Honda revises worldwide and Chinese sales goals for 2012
Having suffered a massive drop in its sales in China, Japanese manufacturer Honda announced that it will be revising its 2012 worldwide and Chinese sales targets, Economic Observer News reported last week. The cuts signify that Honda expects its overall net profits this year to be 20 percent less than previously anticipated. Last month, Honda released its market evaluation for the recently concluded third quarter. According to the evaluation, the manufacturer's sales in China fell a full 40.5 percent in September. In response, the manufacturer has lowered its Chinese sales target for the year from 750,000 vehicles to 620,000 vehicles, a decrease of 17 percent. Honda expects this year's overall net profits to total 375 billion yen ($4.7b). Honda also pointed out that its two Chinese joint ventures are both in the process of reducing production, mainly by reducing worker shifts. Reduced production policies will last until midNovember. The manufacturer expects production and sales in the country to gradually recover. Honda hopes to see its Chinese operations return to normal by next February. China is now Honda's second largest market after the US, and accounted for 17 percent of its global sales in 2011. Executive Vice President Tetsuo Iwamura has previously mentioned that it will continue to expand in the country, with its plans to establish production sites in Guangzhou and Wuhan still in effect...
Monthly AutoMark Magazine
Chery to form partnership with Guangzhou Auto Chery Automobile Co., China's largest vehicle exporter, will sign a strategic partnership deal next month with Guangzhou Automobile Group Co., according to Chinese media. Chery Chairman Yi ng Tongyue confirmed the deal and said it will be the first time that two state-owned Chinese automakers formed such a partnership, reported Sina.com, a Beijing-based Web site. News of the venture surfaced after Automotive Observer, a Beijing-based monthly magazine, reported that Guangzhou Auto Chairman Zhang Fangyou visited Chery in mid-October to discuss the partnership with Yin. The magazine also reported that the two companies would sign the partnership agreement on November 3, citing unnamed sources at Chery and Guangzhou Auto. Additional details about the deal are not
Japan's automakers likely to cut fourth-quarter output in China by 200,000 units Lost sales caused by Sino-Japanese t ension s could fo rce J ap anese automakers to cut vehicle production in China by 200,000 units in the last three months of 2012, IHS Automotive says. The consulting firm estimates Toyota will cut Chinese production by 58,000 units in the fourth quarter, while Nissan is expected to reduce output by 65,000 units. Honda is expected to lose 27,300 units, and Suzuki production will drop by 27,600 units. Mitsubishi and Mazda also are cutting production. The forecast is based on the assumption that China and Japan will find a peaceful resolution to the dispute through diplomacy. However, IHS assumed that tensions over the disputed islands in the South China Sea would linger into next year. The consulting group predicts that Japanese automakers will lose an additional 100,000 units of Chinese production in 2013.
available. Chery, which is headquartered in Wuhu in east China's Anhui province, exported 149,490 vehicles in the first nine months of this year, up 22 percent year-on-year. The company did not release sales results for the period. But according to LMC Automotive, Chery's vehicle sales dropped 13 percent in the nine-month period to 403,111 units. Chery also is in the process of establishing a joint venture in China with Jaguar and Land Rover. Guangzhou Auto, located in Guangzhou of South China's Guangdong province, has joint ventures with Toyota Motor Corp., Honda Motor Co. and Fiat S.p.A. Two years ago, Guangzhou Auto launched its own Trumpchi brand of passenger cars. According to LMC Automotive, Guangzhuo Auto sold 17,769 Trumpchi models in the first nine months, up 63 percent year-on-year.
Suzuki to expand engine output in China Changhe Suzuki Motor Co., a joint venture between Suzuki and Jiangxi Changhe Automobile Co., disclosed plans last week to double the annual output of its engine plant to 150,000 units to support expanded vehicle production. The project, which entails investment of 168 million yuan ($27 million), will be completed by 2013, according to Changhe Suzuki. Changhe Suzuki is located in Jingdezhen in east China's Jiangxi province. Its plant currently builds Suzuki's K14B and K12 engines. Suzuki Motor also has a joint venture in China with Changan Automobile Co. in the southwest China municipality of Chongqing. In the first nine months, Suzuki' sold 193,227 vehicles in China, down 11 percent from the same period last year. Those sales include 56,335 vehicles built by Changhe Suzuki, 133,193 vehicles made by Changan Suzuki, and 3,699 vehicles export ed f rom Japan. Changhe Suzuki produces the Suzuki Wagon R+, Liana and Splash, while Changan Suzuki makes the Suzuki Alto, Ignis, Swift SX4 and Swift Lingyang.
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China Automotive Industry - Update
Beijing approves Jaguar and Land Rover's China JV
Jaguar Land Rov er and Chery Automobile Co. have received the Chinese government's approval to form a joint venture to produce vehicles in China. The National Development and Reform Commission, China's central economic planning agency, posted news of the approval on its Web site. The commission says the new venture will build up to 130,000 vehicles annually plus an equal number of engines at its plant in Changshu in east China's Jiangsu province. The project will require an investment of 12 billion yuan ($1.9 billion), according to China's Ministry of Environmental Protection, which
endorsed the joint venture earlier this year. Additional details about the project have not been released. Currently, all Jaguar and Land Rover models sold in China are imported. Local production will allow Jaguar Land Rover to price cars and light trucks more competitively since consumers would no longer have to pay hefty import duties. That will enable the two brands to better compete with Audi AG, BMW AG and Mercedes-Benz, which dominate China's luxury car market. Jaguar and Land Rover are owned by India's Tata Motors Ltd. In the first nine months of this year, Land Rover sold 32,011 vehicles in China, up 34 percent from the same period last year. But sales of Jaguar cars dropped 7 percent to 2,928 units in the same period, according to LMC Automotive....
Just for the record, Toyota is not pulling out of China Chinese media are saying that Toyota Motor Corp. denies press reports that it plans to pull out of the world's biggest auto market. Gee, we knew tensions were running high between China and Japan over their ongoing territorial spat. But who knew that the dispute had plumbed such lows that the world's biggest automaker was considering packing up its operations and simply going home? Something smacks of political pressure here. It's still unclear who was the original source of the "reports" saying Toyota was going to pull out of China. Japanese media have reported that Toyota is trimming its annual sales target because of slumping sales in China. But there was nothing about abandoning the market. Still, the Chinese government-backed China Daily wasted little time fanning speculation. Late last week, it reported that "Toyota denies withdrawing from China." In case anyone wondered. The China Daily continued: "Toyota has denied media reports that it will withdraw from the Chinese market and shut down production facilities in the country." Just for the record, Toyota does deny it. I checked.
But there is something disingenuous about inventing a news angle that does not yet exist and giving it life through a denial. It's akin to asking Toyota if it plans to pull out of North America or is working on a car that can fly to Mars. Just as China was magically engulfed in "spontaneous" anti-Japanese protests that were turned off like a faucet by the government, you might suspect similar machinations behind local press coverage of the Japanese automakers there. To be sure, Toyota sales in China have plunged in the months following the territorial dispute and riots. And you should never say never, not even about Toyota pulling out of a market. But look at the numbers. Toyota has eight assembly plants in China, with three joint venture partners. Last year, it made more than 800,000 vehicles in China, and the company directly employs more than 28,000 people there. Through August, it sold more than 630,000 vehicles -- enough to rank as t h e c o un t r y ' s N o . 4 f o r e i g n manufacturer. What's more, Toyota just opened its third technical center there. Pulling out of China wouldn't just be foolish -- it's impossible...
Monthly AutoMark Magazine
Toyota China sales plunge 44% in October Toyota Motor Corp., which saw September sales in China tumble the most in a decade, reported deliveries slumped for a second straight month as Chinese consumers shunned Japanese cars. October deliveries declined 44 percent from a year earlier to 45,600 vehicles, Asia's largest automaker said in a text message Thursday. That follows the 49 percent drop in September. In the first ten months, sales fell 1 percent to 685,900 units, it said. The results, which come four days before Toyota reports earnings, shows the aversion toward Japanese brands persists in China even though protests have subsided since September. Honda Motor Co., which cut its annual profit forecast by 20 percent this week, said demand may not return to normal until the Lunar New Year in February. "The decline in China sales completely threw cold water on Japan's auto industry," Satoshi Yuzaki, Tokyo-based general manager at Takagi Securities Co., said by phone. "Japan's auto industry was seen as a strong industry in terms of export earnings, so the drop in China sales is very unfortunate." The anti-Japan backlash, fueled by a territorial dispute over a group of islands claimed by both countries -- is turning into an opportunity for other foreign automakers to pick up market share in China....
Chinese Loncin CR9 Bike Uses BMW G650GS Engine BMW has Chinese manufacturer Loncin building their G650GS engines since 2005, with more than 35,000 units sold. The BMW-Loncin deal has taken a step further, as the Chinese manufacturer has been granted a new license. Not only will they keep on supplying BMW with the said motors, but they will be allowed to build their own new bike, for the Chinese market only. Thus the single-cylinder 650cc engine will now power Loncin's all-net street bike CR9. The engine specs have not been changed, so the new Chinese street bike will have the same 49 BHP power. To be honest, the Loncin CR9 looks really neat and could be a hit on the Chinese market.
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Oct 11 - 14 , 2012 Chongqing, China
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China Automotive Industry - Visit
Monthly AutoMark Magazine
Monthly AutoMark’s editor visits Lifan Motorcycle Factory in Chongqing, China
We all know that China is a great place to manufacture electronics. But have you ever come across the fact that more than 50% of the World’s motorcycles are being manufactured in China? Yes, the Chinese motorcycle industry is booming and I had a chance to visit the Lefan Motorcycle Factory during my stay in Chongqing, China to cover the CIMAMotor-2012 motorcycle trade exhibition from 11-14 October-2012. Lifan's Chongqing plant is located about a 40-minute drive from the city’s center in a well-kept ind ustrial park. The city is maintained so well that you wouldn’t believe that it was China unless you are told so. A group of journalists including me arrived at the factory around 9.30 AM on a cloudy day. Like most factories, the exterior is nondescript, just endless concrete walls punctuated by occasional doorways and red signs announcing the company name and some slogans. Inside, the factory is neat, clean, orderly -- and massive. I don’t think I’ve ever been in a motorcycle factory this large. I was told that it covers more than 2.1 million square feet and is one of three plant s ded icated to mot orcycle production. It’s a bit like stepping into the warehouse in the last scene from “Raiders of the Lost Ark.” I had long dreamt of visiting Honda assembly plant in Pakistan but haven’t got a chance so far, but visiting a Chinese
motorcycle industry almost fulfilled my dream. The factory seemed to have more people working in it than most, and the production line seemed to move a bit slower than I recall at KTM or Triumph. But I was told a bike pops off the production line every 30 seconds or so, so things are moving at a pretty good pace. The facility has three production lines but only one was running during our visit, and like all good production lines it was producing a three or four variations of the 20 to 25 models that are built by Lifan. When the factory is running all three production lines, it can produce 1,000 units a day and 1 million per year, not counting its capacity to crank out 3 million engines annually. One thing that stands out in my mind is how quiet it was. Most factories I’ve been to are pretty noisy, but this one was remarkably quiet, probably attributable to the fact that only one line was running and the building is enormous. The factory was a very long stretch of parallel assembly lines. If you can walk from one end of the factory to the other end, you can witness a complete motorcycle being assembled from parts to finish. That being said, the typical plant tour merely shows you that the plant is clean, laid out in nice straight lines, and
building product. The real meat is in the briefing, which usually comes afterward. Each motorcycle model has a separate assembly line. The parts needed for the bikes are filled in the moving selves by a set of employees. As it starts moving, the people at each part of the assembly take the parts from the shelf and assemble it on the belt which moves very slowly. In one part of the belt, you can see engines being assembled, a few metres away you can see the bike taking shape. Keep moving and you will start seeing tyres, lights, seats and so on. The manufacturing industry in China is old and t he process has been streamlined over the years. One of the major factors for their success is the availability of man power, but the fact that they have streamlined the system cannot be ruled out. In the near future, do not be surprised if you see a tag under your German bike such as –“Desinged by BMW in Germany, Manufactured in China.” In Pakistan Lifan brand is very famous not only in motorcycle sector also in other small engine. We see many motorcycles are running the roads of Pakistan.. Also in China it's apparent that Lifan is quite popular here.
GLOBAL PLANS After a brief tour of the factory we had a Q & A with Bob Yang, vice president
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China Automotive Industry - Visit
and general manager, Zhu Ziaoman, vice general manager, and Tang Xiao Dong, secretary of the board. A kickoff video provided some background information on Lifan. Lifan builds and sells motorcycles, cars, trucks, vans, generators, engines and a variety of industrial goods. It employs almost 16,000 workers, 8,000 of which have either a college or technical school background. In 2011 it produced and sold over a quarter-million cars, 1.8 million motorcycles, and over 4 million engines of various types. Lifan is Chongqing’s leading exporter, with a net income of over $3 billion, and one of China’s top 500 companies. In 2011 Lifan signed an agreement with MV Agusta forming a strategic partnership which, according to our hosts, will lead to exchanges of
Monthly AutoMark Magazine
technology and prepare Lifan to enter the world market of big bore, 600-plus cc, and sport and “leisure” motorcycles as well as lift the level of quality and sophistication of motorcycles slated for domestic sales. Yang further stated that though the U.S. market was difficult in terms of consumer demands and regulations, it was a “strategically important” market, and that Lifan must have a presence in order to be successful as a worldwide motorcycle company. The Chinese motorcycle manufacturers are starting to recognize the need for improved quality, better technology, and better service, not just in overseas markets but to domestic markets as well, and the execs at Lifan echo that refrain.
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Monthly AutoMark Magazine
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CIMAMotor-2012 Exhibitions Glimps
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