Automark July 2017 by Mustafa Hanif

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Contents

July-2017

News / Event

Article / Review 15 16 18 19 20 22 41 46 49 54

Al-Haj FAW Group confirms its plans to start local assembly of V2 in Pakistan Exclusive article by Syed Sarim Raza Need to check fishy bike deals to safeguard consumers Exclusive by Ali Hassan Hydropower Project in Pakistan by the courtesy of IFC Exclusive article by Asif Masood

Inside

28 52

Future Motorcycle Parts - Annual prize distribution ceremony 2017

Swedish auto giant Scania to sell heavy vehicles in Pakistan

Interview of the Month 26

Electric Cars – Do they have A future in Pakistan? Exclusive review by Ahsan Mirza

An exclusive interview with Anwar Iqbal

News Updates First Positive out come, upon The completion of first year of New Auto Policy 2016-21 Exclusive Article by Anwar Iqbal PAMA keeps mum, stakeholders divided over EDB’s disbanding Exclusive article by Owais Khan

Why we need more Small Cars in Pakistan Exclusive Review by Syed Sarim Raza

Chinese team to visit proposed sites for SEZs under CPEC

34 Tractor subsidy scam involving Rs1.45b 43-45 International Auto News 53

Corporate News - Glimpses

The Journey Of Cultus Exclusive review by Taha Bin Mujahid Comparisons Unlimited 125cc & 150cc Bike Categories Article by Mr. Zahid Malik Most Popular Cars in Pakistan by Zohaib Velani

Price List 44

Vehicles/cars price list

Motorcycles price List

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July-2017 Pakistan’s premier magazine on automotive, engineering & energy sector Volume 10, Issue 07

Monthly

AUTOMARK Magazine International Editor-in-Chief Muhammed Hanif Memon Technical Editor

Advisors

Imtiaz Rastgar CEO, Rastgar Group & Advertising Manager CBI External Expert, Ex-chairman EDB Tahir Siddiqui Islamabad Muhammad Shahzad

Circulation Manager Hasaan Mustafa

Graphic Designer Mustafa Hanif Salman Hanif

Web Master Murtaza Hanif

Contributors in THIS EDITION M. Owais Khan Anwar Iqbal Asif Masood Zahid Malik Ahsan Mirza M. Hanif Memon Ali Hassan Sarim Raza Taha Bin Mujahid Zohaib Velani

Engr. IHT Farooqui Chief Operating Officer Pak China Motors (Pvt) Ltd. Karachi M. Yousuf Shaikh Founder & Chairman Pakistan China Motorcycle Industry Council Karachi Syed Mansoor Rizvi Principal Officer M/s. CNH Services (Pvt) Ltd. Karachi Nadeem Ahmed Salmi Executive Director Operations M/s. Al-Haj Faw Motors (Pvt) Ltd. Karachi

Active Communications Mailling Address: D-68, Block-9, Clifton, Karachi Tel : 021-32603371 Mobile: 0321-2203815 E-mail: automarkpk@gmail.com website: www.automark.pk Whatsapp & Wchat : +92 321 2203815

AutoMark Canada Office Managing Editor Mohammad Shahzad S.A.E. D.M.P. 41 Jordana Drive Markham (Toronto) Canada - L3S 3N8 Phone: 905-472-8282 Email: automarkcanada@gmail.com AutoMark REGD: MC-1330 Published every month by M. Hanif Memon

ENGINEERING DEVELOPMENT BOARD DISSOLVED BY THE GOVERNMENT AMID ALLEGED CORRUPTION CHARGES In a move that surprised several stakeholders of the Pakistani auto manufacturers fraternity, the Government of Pakistan has dissolved the Engineering Development Board (EDB), a part of the Ministry of Industries and Production. The move comes after the board was alleged to have been involved in malpractices, corruption of its staff and members, and for creating disharmony in the inflow of multibillion dollar investments into the Automobile Sector of the country. The affected stakeholders, including PAMA and PAAPAM, business associations, engineering bodies, and industrial experts have unanimously opposed the move and have termed it as an unjustified decision, as it has widely been believed that the credit for the development and growth of the entire auto parts vending industry’s goes to this institution. Initial reports in a local English daily paper on the 8th of June 2017, and several reports circulating in the mainstream media thereafter stated that the EDB was required to implement the new Auto Policy, but created barriers in the way of potential new entrants– most of whom had already done heavy ground work and had imported machinery to set up their plants in Pakistan. The EDB was actively reluctant in giving the go-ahead which prompted new players to lodge a complaint with the government, forcing the Ministry of Industries to step in and grant permission to three new companies out of nine companies to set up their vehicle assembly plants. The cumulative investment to set up assembly plants under Greenfield investment by United Motors Private Limited, Kia-Lucky Motors Pakistan and Nishat Group stood at $372 million. Last year, a new Auto Policy was introduced by the government to stimulate investment in automobile manufacturing to break the triopoly of the three major players in the Pakistani market, who were offering vehicles at higher prices and counting on obsolete technology to maintain their competitive advantage. Several policy makers and veterans of the manufacturing industry of Pakistan praised the role of EDB with regards to implementing the governmental policies, saying its strict monitoring mechanism developed the auto parts industry in Pakistan, adding that the car industry’s localization level touched over 70 percent due to the supreme work done by the EDB. The presence of corruption in every major sector in Pakistan has curtailed the development of the country, and it must be accepted that alleged involvement of corruption in a big institution such as EDB is not something new. The EDB has long been known to support the vendor industry by handling various SRO’s, by assuring local content enhancement and curtailment of rollback, based on the government’s policy guidelines. Additionally, the EDB’s role in putting Pakistan on the map as the manufacturer of quality products, especially in the Auto Sector, cannot be ignored. However, the intervention of the ministry in doing the work of the EDB, signals a clash of authorities, where EDB would have been better off performing the duties itself. Moreover, for the betterment of an already disorganized national system, it is imperative that independent bodies are given time and room to do their work with full autonomy and without interruptions.The auto industry has been booming recently and the closure of the EDB will severely affect the engineering industry, primarily leading to the abandonment of investments into the Auto sector, something that the economy of Pakistan cannot afford, especially at this point in the country’s development stage.

Note: The views expressed by contributing writers and comments do not necessarily reflect the views and policies of the Monthly AutoMark magazine's management

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Monthly AutoMark International

Exclusive by Syed Sarim Raza

Al-Haj FAW Group confirms its plans to start local assembly of V2 in Pakistan In a delightful new development for car enthusiasts in Pakistan, the Al-Haj FAW Group has confirmed the plans to start the local assembly of its popular compact hatchback, FAW V2 in Pakistan. The Group has now officially stopped the import of CBU units and bookings are opened for the locally assembled FAW V2. This will be a unique achievement for Al-Haj FAW Group as the import of CKD (Complete Knock-Down) units from China to Pakistan.

Historical Background of FAW V2 in Pakistan FAW is a renowned Chinese car maker in the world. The company has a strong reputation for manufacturing vehicles that follow the global standards for automotive engineering. In a joint venture with the FAW Group of China, the Al-Haj Group of Pakistan launched the FAW V2 Hatchback for the first time in Pakistan in 2015. In the start, the AlHaj FAW Group only imported the CBU units from China and sold the Hatchback at a highly affordable price of Rs. 1,049,000 in Pakistan.

How the Al-Haj Faw plans to assemble FAW V2 in Pakistan? There had been rumors going around that Al-Haj FAW Group had dismissed its plans to start the local assembly of FAW V2 Hatchback in Pakistan after the Group was denied of Green Field Investment Request by the Government of Pakistan. However, it has now been confirmed by Al-Haj FAW Group in an exclusive conversation with Automark Magazine Pakistan that the inauguration event for local assembly of FAW V2 will be held in August 2017 and the Group will launch the locally assembled FAW V2 in line with the new Auto Development Policy 2016-21 of the Pakistan Government. The Director Marketing Division of AlHaj FAW Group, Mr. Farhan Hafiz told Automark that the pre-booking of the locally assembled FAW V2 has already

started and customers in Pakistan are welcomed to book the FAW V2. He also confirmed that it will just not be an event to kick-start the venture of local assembly of FAW V2 in Pakistan, but it will also be a launching platform for most of the pre-booked FAW V2 cars. He said that the Group will make its best efforts to deliver the maximum number of pre-booked vehicles to customers at the event and aims to complete the delivery of all pre-booked vehicles within two to three months of the launch event. Mr. Farhan Hafiz also informed Automark Magazine about the capacity of the local assembly unit of Al-Haj FAW Group in Pakistan. He added that the per annum capacity of the assembly unit for Light Vehicles is 10,000 and the Group aims to capitalize on its maximum capacity and produce 10,000 Light Vehicles including the XPV, Carrier, SIRIUS GRAND and V2 as per the market demand in year 20182019. V2 is going to assemble at state of the art assembly plant with recently established E.D. coating and baking facilities which is the only facility available in Pakistan with Chinese company.

Why the launch of locally assembled FAW V2 bears great significance? The launch of locally assembled FAW V2 will be a huge breakthrough for the Al-Haj FAW Group as the high-indemand FAW V2 will be launched without any change in its earlier price. According to the Mr.Farhan Hafiz, the Al-Haj FAW Group is only focusing on the customer satisfaction at the expense of many benefits that the Group could achieve by launching the locally

assembled FAW V2 at a higher price than before. The supply of CKD units from China to Pakistan is a difficult as well as an expensive process, but Al-Haj FAW Group is dedicated to putting their best foot forward in bringing the locally assembled FAW V2 in Pakistan that will satisfy their customer base which is growing at a rapid pace already. In this way, it offers a great opportunity to customers to buy one of the highperformance hatchbacks in Pakistan at an affordable price. It will be a big stepping-stone for Al-Haj FAW Group towards achieving seamless growth in a highly competitive market of Pakistan’s the local assembly of FAW V2 will ensure lower maintenance costs and easy availability of spare parts, two factors that are mostly considered by the car buyers in Pakistan whenever they look to buy their next car.

Competition faced by the FAW V2 in local market of Pakistan A common perception in the automotive industry and among the car enthusiasts in Pakistan is that FAW V2 has its serious competition with the likes of Suzuki Swift, Suzuki Celerio and other similar vehicles. Al-Haj FAW Group though denies it and stresses on the fact that FAW V2 doesn’t compete against any giants of the auto industry as yet. Mr. Farhan Hafiz was of the view that it’s true that many well-reputed brands are offering their vehicles in the hatchback segment, but FAW V2 is a better option because of its affordable price, powerful 1300cc engine, fuel efficiency, modern body style, enhanced driver and passenger safety and a desirable driving experience. He added that Al-Haj FAW Group expects to give tough competition to other car brands in the similar segment in next five years, but right now the main focus of the Group is only on widening the customer base in Pakistan by catering to the demands of car buyers.

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Exclusive Article by Ali Hassan

Need to check fishy bike deals to safeguard consumers Ministry of Industry Government of Pakistan

It is hard to digest that how the companies are trying to sustain in the stiff competition and how they are ensuring delivery of bikes at Rs 25,500 to the buyers. Market sources said these bike sellers are procuring two wheelers from the markets on original rates and they are handing over the bikes to the customers at discounted rates which do not click the mind of old market players. After a gap of seven to eight years – a new game has started all over Pakistan in which customers are being asked to deposit Rs 25,500 only for 70cc Chinese bike of any brand. The buyers are assured by the selling companies that they will get the delivery of bike after one month. The sellers ask bike buyers to arrange two more customers for depositing Rs 25,500 each before the delivery of first customer’s bike. If the buyers succeed in managing two more buyers then this deal is called a “matured deal” between the buyer and the seller. Surprisingly the two buyers are also being bound to arrange two more buyers separately. According to a market study, famous brand of Chinese 70cc is available in the market at the rate of Rs 42,000 to Rs

44,000. On the contrary, infamous brands can be purchased at Rs 37,000 to Rs 40,000. These dealers are also selling Honda bikes for which the amount of advance payment is Rs 40,000. It is hard to digest that how the companies are trying to sustain in the stiff competition and how they are ensuring delivery of bikes at Rs 25,500 to the buyers. Market sources said these bike sellers are procuring two wheelers from the markets on original rates and they are handing over the bikes to the customers at discounted rates which do not click the mind of old market players. Chairman Pakistan Tajir Itehad (PTI) and Association of Pakistan Motorcycle Assemblers (APMA), Mohammad Sabir Sheikh recalled that the people of Pakistan know very well about the

history of Tawakal Group in the auto sector. He said some of the units were closed due to default in repayment of bank loans. It is usual practice in Pakistan automobile industry to generate funds through advance booking of the vehicles. Sources said as per media reports, everybody is aware of Rs 800 million fraud by two sons of Abdul Qadir Tawakkal Group/Naya Daur Motors under the name of Kia pride car. About 16,000 people lost their hard earner savings in this scam of 1994 by Naya daur motors. The accused were involved in Kia Pride car scam along with their father in which more than 16,000 poor people were deprived of their hard earned cash through advance booking of the vehicle all over the country. After collecting

Chairman Pakistan Tajir Itehad (PTI) and Association of Pakistan Motorcycle Assemblers (APMA) Mohammad Sabir Shaikh said the government should allow new entrants to book vehicles in the range of 400-500 units and the State Bank should keep an eye on new entrants. He said the State Bank should come out with a policy under which only selected number of vehicles are booked and released to the customers rather than taking heavy booking or failing to deliver vehicles on time. www.automark.pk | July-2017 | Page 16

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Monthly AutoMark International more than Rs 800 million the accused failed to provide cars to their customers and fled to the US. Sabir said has the government framed any rules for the new entrants under new Auto Policy which can safeguard the money of common men of the country. They are offering cheap vehicles in the market to lure customers. They are unknown and do not have any financial worth in the markets. After taking heavy money from the customers there is no guarantee from them to ensure early deliveries of bikes or they may run away by collecting huge amount of customers. Sabir said the government should allow new entrants to book vehicles in the range of 400-500 units and the State Bank should keep an eye on new entrants. He said the State Bank should come out with a policy under which only selected number of vehicles are booked and released to the customers rather than taking heavy booking or failing to deliver vehicles on time. Sabir said the government should also ask the assemblers not to work on only single model of bike or car and they should diversify their efforts by introducing new vehicles in Pakistan. Sources said the above practice of luring bike lovers is a kind of indirect sales in which dealers are lifting bikes directly from assemblers based in Sindh. They said an investigation is going on against an assembler who was alleged of providing bikes directly to these kinds of dealers. Besides this mode of bike sales, a regular scheme of selling bike on â&#x20AC;&#x153;monthly installmentâ&#x20AC;? has gained pace in the last few years which is certainly an attractive

option for many people who cannot afford to buy even cheap Chinese bikes on full cash payment. A large number of population still relies on private public transport since the government especially the Sindh has so far not come out with any urban or rural transport scheme. The top government officials of Sindh government are only paying lip service for providing effective transport system. The major beneficiaries of this normal bike installment scheme are also young boys working in courier companies and food chains who use two wheelers to hand over parcel to the consumers. The dealers take Rs 25,000 for 70cc bike as an advance payment leaving an open option for the consumers to pay monthly installments of two to four years. The total cost of bike swells to Rs 60,000 on installment. Consumers usually take the bike on installment and after using it for at least two years purchase another bike on same facility. Sources said that the assemblers are reported to have reached an understanding with the Excise and Taxation Department that the original book of bike will have two names as (owner and seller). The registration charges are higher than normal registration charges due to inclusion of two names in the book. The buyer gets the photo copy of bike book and documents after purchasing the bike while the sellers (dealers) hold the original documents. People have literally gone wild for two wheelers in the last one to two years since the law and order situation has improved coupled with better farm income from some cash crops. Pakistan has seen good sugarcane and wheat crops followed by rice. Rural population and growers of various crops prefer Honda bikes due to its quality and durability as well as good after sales and service. The construction activities and other projects under China Pakistan Economic Corridor (CPEC) especially in up country has generated extra demand for bikes. Surprisingly the costly Honda bikes have surpassed its cheap Chinese bike makers in terms of sales by continuously breaking its monthly sales records. Honda motorcycles broke its monthly

sales and production record by achieving production of 90,800 and 93,060 units, respectively, in May 2017. Surprisingly, the second highest bike maker, United Auto Motorcycle, has also broken its production and sales record in May 2017 by assembling and selling 31,347 units each. Overall bikes of Atlas Honda Limited hit 888,640 units in July-May 2016-17 as compared to 748,911 units in same period last fiscal. Suzuki bike sales stood at 16,725 units as against 16,099 in JulyMay 2015-16. Yamaha bike sales declined to 12,262 from 15,239 units. United Auto Motorcycle assembled and sold 298,329 bikes each in July-May 2016-17 as compared to 236,567 units in same period of last fiscal. Some other assemblers continue st rugg li ng. F or in st ance, D YL Motorcycle sales plunged to 6,972 units in July-May 2016-2017 from 7,375 units in same period last fiscal. Hero and Ravi bikes sales stood at 2,512 and 20,134 units as compared to 2,718 and 18,523 units. Despite rising bike sales, the import of CKD/SKD kits for bike assembling fell to $73 million from $82 million in JulyApril 2015-16. It gives an impression that either the bike assemblers have achieved higher localization and they do not need imported parts or there is something wrong going on. The two/three wheeler sector offers most preferred and economical means of transport and best alternative in the absence of public transport and thus holds considerable opportunity of growth. The figures of two/three wheelers essentially represent the organized sector and leading producers and shall be higher as there are 2/3 wheeler assemblers outside PAMA, Economic Survey 2016-2017 stated.

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Exclusive article by Asif Masood

Monthly AutoMark International

Hydropower Project in Pakistan by the courtesy of IFC Pakistan is a water rich country but, unfortunately, Pakistan’s energy market investment in hydelpower generation has been caught up in confusion and paradoxes for more than a decade, and no significant progress has been achieved so far. On the other hand, the Government is trying to facilitate private investors to promote hydel power generation in the country. Hydropower is a primary domestic source of energy. Pakistan is endowed with a hydel potential of approximately 41722 MW, most of which lies in the North West Frontier Province, Northern Areas, Azad Jammu and Kashmir and Punjab. The International Finance Corporation (IFC), a member of the World Bank Group, promotes sustainable private sector investment in developing countries as a way to reduce poverty and improve people’s lives. In addition to its investment work, IFC executes a major donor-funded program of private sector advisory services in South East Asia. Within IFC Advisory Services in the region, the Sustainable Business Advisory business line (SBA) anchors the Corporation’s objective to improve the performance and competitiveness of local enterprises by equipping them with market intelligence and new skills and tools, enabling them to access finance and meet changing market needs and increased competition in the local, regional, and international economies. As part of its global mandate, IFC is supporting activities to address climate change by promoting renewable energy and energy efficiency investments in emerging markets. The Hydro project is part of IFC’s efforts to launch its Renewable Energy business in the region. In most of the project financing, env ironment al and social risks traditionally have been managed one at a time. IFC is changing the dynamics by

considering and addressing the impact of project on the entire region and int erconnected ecosystems and communities by bringing together the private and public sector, civil society and local communities on one platform. To meet future energy challenges, governments of energy scarce countries in the region are planning new investments for energy generation while developing and implementing plans for gradually removing high level energy subsidies to reduce budget deficits. S i mu l t a n e o u s l y , t h e P ak i s t a n government is setting ambitious targets for 2020 for meeting their energy demand from abundant renewable energy (RE) sources. The Jhelum-Poonch basin is a vast source of hydropower in Pakistan. More than 50 power plants are located along the two rivers, in various stages of operation and development. Six of them are being financed by IFC. They are expected to bring up to 4,000 megawatts of additional power to Pakistan, where daily blackouts last for up to minimum of eight to twelve hours for the last so many years. IFC has taken on the challenge to help develop Pakistan's rich hydro resources and save the people from load shedding. IFC's Environmental and Social Performance Standards, integral to our business model require that projects financed by IFC will also have positive outcome on biodiversity. To design the first comprehensive biodiversity strategy for the entire basin, the financer has

brought together clients, other developers, i n v es t o r s , an d re pre sent at iv es from academia, governments and environmental organizations. The strategy incorporates a set of common guidelines for all hydropower plants operating in the region. IFC continues to work with all stakeholders to address additional environmental and social challenges including those related to safety, labor conditions, community relations and effective grievance mechanisms. IFC hydropower portfolio projects in the

Jhelum-Poonch Watershed are: • New Bong Escape: 84 MW • Star Hydro: 150 MW • Gulpur: 102 MW • Karot: 720 MW • China Three Gorges South Asia Investment Limited (CSAIL): Two projects totaling 2,400 MW Cost effective renewable energy will definitely improve Pakistan’s economic performance. Energy efficiency along with conservation measures can result in profitable business units. Thus, exploitation of these sources of energy can lead to poverty alleviation. Use of indigenous renewable resources can help Pakistan in diversifying its energy mix. This will reduce the country’s dependence on any single source, particularly imported fossil fuel. Local environmental and health hazards introduced by fossil fuel powered electricity generation plants can be largely circumvented through clean renewable energy alternatives.

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Future of electric cars in Pakistan by Ahsan Mirza

Monthly AutoMark International

Electric Cars – Do they have A future in Pakistan? Pakistan needs to start planning for charging sources EVs will use once they are launched on a wider scale. While Dewan Motors did take up the initiative and installed three BMW Hybrid and EV charging stations in Lahore last year, which draws power from the national grid,replicating the same kinds of charging docks all over Pakistan is going to add significant load to the country’s growing electricity demand Introduced more than hundred years ago, electric vehicles (EVs) are seeing a rise in popularity today for many of the same reasons that made them first popular. Be it a hybrid, a plug-in hybrid, or an all-electric vehicle, the demand for EVs will continue to climb as their prices drop and consumers look for ways to save money on usage as well as maintenance. Currently accounting for more than 5 percent of new vehicle sales globally, electric vehicles sales could to grow to nearly 7 percent – or 6.6 million per year – worldwide by 2020, according to a report by Navigant Research. With this growing interest in EVs, and with an increasing emphasis on fossil fuel reduction and carbon pricing worldwide, automobile manufacturers are swiftly shifting their focus on the research, develo pment , and manufacturing of EVs. Hybrid and Electric Vehicles emerged in the Australian, Canadian, the US, and most of the European market in 2010. Initially, people were skeptical of buying and adapting to this technology. Electric vehicles are now starting to make a presence for personal use and we can observe the use of renewable energy for electric power generation. But it ends there. The entire commercial world is run on oil and gas – trucking, temporary power generators, agriculture, and construction equipment, etc. If anyone thinks solar energy can power a bulldozer at this point in time, then they do not possess any true understanding of how much power we generate with existing models over the renewable sources. We will, however, see more electric vehicles used by consumers, but we have to be realistic, in every sense of the word. There is a big difference between powering a car, like a Civic or even a Vezel, and powering a truck or 18wheeler. That may not be possible in the next three years. Like most of the developing countries, Pakistan too has a strong market for

hybrid vehicles, with Honda Vezel, Honda FIT, Toyota Prius, Toyota Aqua, and other such models having a significant presence on the Pakistani roads. Leading aut omobi le manufacturers, including Super Power Motorcycles, have started introducing EV models with a wide range of prices, targetingcustomers of diverse income groups. One such model is pricedat PKR 600,000, which suggest that Pakistani manufacturers are willing to risk investing in this market segment. Several members of the international automobile industry (South Korea, China, and Japan) also believe that Pakistan is a high potential market for EV technology, and local businesses are collaborating with them to bring EVs in Pakistan. The auto industry in Pakistan is also going through a major shift mostly due to the recently introduced Auto Development Policy 2016, which led to the entry of major international players in the Pakistani market, which included manufacturers and importers of hybrid and electric cars. However, the duties imposed on the imported EVs amount to almost 50%, which makes these cars difficult to afford for the majority. The Pirani Group had previously written to the Secretary of the Pakistan Chamber of Commerce, and had asked him to reduce the taxes and duties on Imported Electric Vehicles from 50% to 0-5% for the upcoming fiscal year’s budget, to ensure that the cars become more easily accessible and available for the

Pakistanis to buy. However, EVs present two major problems in Pakistan. Firstly, the severe shortfall of electricity and the frequent power cuts due to ‘load shedding’. Secondly, the consumer mindset and their reluctance to invest in EVs as compared to them investing in conventional fuel cars. Electric cars, despite demanding high maintenance once every few years, are extremely fuel efficient and save up significantly on fuel costs. It is high time that people are made aware of the use of electric vehicles in Pakistan, especially in urban areas, to decrease the carbon footprint. Although people have been intrigued by the idea of hybrid cars, they are majorly still reluctant to completely transform their garage into fully electric cars due to long driving hours, even within cities. The technology is neither cheap nor simple to construct. EV producers, importers, and investors can explore the possibilities of making ‘charging stations’ in Pakistan, whilst setting up plants that produce auto parts for these EVs. As compared to 43,000 charging stations in the U.S, Pakistan has next to zero charging stations. Pakistan needs to start planning for charging sources EVs will use once they are launched on a wider scale. While Dewan Motors did take up the initiative and installed three BMW Hybrid and EV charging stations in Lahore last year, which draws power from the national grid,replicating the same kinds of charging docks all over Pakistan is going to add significant load to the country’s growing electricity demand.Working on sustainable charging systems for EVs is another way of limiting the increase in electricity demand that EVs will have a need for, but all of that would be considered once the future of electric vehicle in Pakistan becomes a little more certain. For now, we will have to wait to know what road electric vehicles will take in the future. Let us all hope that it is a road worth waiting for!

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Exclusive Article by Anwar Iqbal

FIRST POSITIVE OUT COME, UPON THE COMPLETION OF FIRST YEAR OF NEW AUTO POLICY 2016-21 The opinion of Secretary Industries Mr. Khizer Hayat Gondal is that the matter may be resolved by the involved companies themselves because Ministry of Industries or Engineering Development Board could not function as court of law. New Auto Policy has already celebrated its first anniversary without any good news. This is a matter of the great concern for the Architects of this policy. To overcome this problem and in order to facilitate the prospective investors a meeting was called by Ministry of Industries and Production on 6th June 2017. Although it was a positive step but seems that meeting was hurriedly called as no agenda was described in the invitation letter. However the objective of the meeting was to heard the grievances / hurdles and problems being faced by the new investors who intend to set up their automobile assembly plants under Greenfield scheme. The meeting was co-chaired by Secretary Industries and Production Mr. Khizer Hayat Gondal and Secretary Board of Investment (BOI) Mr. Azhar Ali Chaudhry.

The following companies were invited and present in the meeting. 1. Cavalier Automotive Corporation (Pvt) Ltd., Islamabad 2. Foton JW Auto Park (Pvt) Ltd Lahore 3. Habib Rafiq (Pvt) Ltd Lahore 4. Hyundai Nishat Motors (Pvt) Ltd., Faisalabad 5. Khalid Mushtaq Motors (Pvt) Ltd., Karachi 6. Kia Lucky Motors Pakistan Ltd Karachi 7. Pak-China Motors (Pvt) Ltd Karachi 8. Regal Automobile Industries Ltd., Lahore 9. United Motors (Pvt) Ltd Lahore Secretary Industries Mr. Khizar Hayat Gondhal briefly explained the objective of the meeting. He showed his concern

about the no material and tangible p r og re ss w as mad e up o n t he competition of the first year of newly introduced of auto policy. He said that at one side the old players are not happy as new policy did not offer any concession to them and on the other hand no single new players able to start its business venture in last one year. He further elaborated that he wants a direct interaction with the prospective investor and would like to redress their grievances immediately. As Engineering Development Board is the main window for the prospective investors so the Chief Executive Officer Mr. Mirza Nasir Baig was also present in the meeting. All invitees prospective investors openly said that they have no complaints against Engineering Development and appreciated the new auto policy, however, pointed out that policy needs to adopt a written laid down procedures to avoid delays which occurs due to confusions in the explanations of the policy. I was also one of the invitee being prospective investors so I raised some questions with the permission of the chair. Interesting all prospective investor being present in the meeting was agreed with my opinion. My questions quarries and reservations are as under.

time of ground breaking ceremony (in first phase). After six month to one year (depending upon the response of market / customer) they launch similar variant passenger van with 11 seats capacity. In second year plan to launch a SUV, 4 wheel drive with same engine capacity. In third year would like to introduce a Light Duty Truck with loading capacity of 3 Tons. In fourth year they plan to launch a 14 Seater Hiace Van. The question is would they be entitled to import 100 units of all variants / vehicle in CBU at 50% of the prevailing duty for test marketing.

1. 50% Concession Duty on 100 Unit CBU

A prospective investor is also eligible for duty free import of plant and machinery for setting up the assembly and/or manufacturing facilities on onetime basis. Now the question is how and when he will get this exemption certificate and from which authority i.e EDB, BOI or direct from Ministry of Industry’s. Please note that this exemption certificate is required before the establishment of the plant because arrangement for the import of plant machinery and equipment will be executed accordingly. It needs clarification about the definition

It is mentioned in the policy that “Import of 100 vehicles of the same variant in CBU form at 50% of the prevailing duty for test marketing after ground breaking of the project.” If a company plans to launch a single product i.e. Light Commercial Vehicle with 1.5 Ton Loading Capacity at the

2. Permission for Imports of Parts for Five Years As a Green Field Investor we are entitled to import the non-localized and localized parts for the period of five years on concessional rate of custom duty. The question is when and how these five years shall be calculated means at what stage our eligible time will start and when it will be finish.

3. Duty Free Import of Plan & Machinery

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Monthly AutoMark International of the plant and machinery. It may be noted that utility equipment such as generator, lifters, compressor, chiller and cooling towers are also the part and parcel of the plant and machinery.

4. Withdrawal of Incentives In Auto Policy 2016-21, under above caption, it is mentioned that an agreement will be signed between new entrant and Government of Pakistan. What is the format of this agreement ?? prospective investor also need the draft of this agreement in the very beginning for our understanding. Fortunately Secretary Industries Mr. Khizer Hayat Gondal was also appreciated my openion / explanation and immediately issued instruction for the solutions to the concern quarters. Furthermore he announced that for the follow up, such meeting will be called every month for the discussion / solution o f r e l e v a n t t a x ma t t e r s t h e representative of Federal Board of Revenue may also be invited in next meeting. Two participant in the meetings i.e. M/s. Regal Automobile Industries Ltd and M/s. Foton JW Auto Park (Pvt) Ltd., has dispute with the present / former local partners of their foreign principals in both cases the present / former partners of their principals submitted their objections with the request that M/s. Regal Automobile Industries Ltd and M/s. Foton JW Auto Park (Pvt) Ltd, could not get the approval as a Greenfield investors, due to this dispute EDB is unable to process their applications. The opinion of Secretary Industries Mr. Khizer Hayat Gondal is that the matter may be resolved by the involved companies themselves because Ministry o f I n d u s t r i e s o r E n gi n ee r i n g Development Board could not function as court of law. Later, it was confirmed that M/s. Master Motors (Pvt) Ltd moved to the court of law and register it complaint against Foton JW Auto Park (Pvt) Ltd with a request that they are doing CKD business with Foton since last 15 years, so any other company could not use FOTON name as brand and can not launch any company with the name of FOTON. As I mentioned earlier that this meeting was held on 6th June in Islamabad and ended with a very positive note. Surprisingly, just after one day on 8th June a local English daily reported that Government has decided to dissolve the

Engineering Development Board for alleged involvement of its staff in corruption and malpractices as well as for creating hurdles in the way billions of dollars investment flows into the automobile sectors. It was further learnt that on June 9, 2017, Secretary to Prime Minister, Fawad Hasan Fawad wrote a letter titled "appointment to the post of Chief Execut iv e O fficer, Engi neering Development Board (EDB)" to the Ministry of Industries and Production and explained the reasons for winding up EDB. The reasons included corruption and malpractices. The key section of the EDB which is involved in malpractices is tariff section. The Secretary to Prime Minister stated that during the meeting of Cabinet Committee on Energy (CCoE) chaired by the Prime Minister on May 29, 2017, it was observed that EDB was not performing any useful function, either in terms of regulation or promotion of engineering enterprises, adding that malpractices had become endemic in the Board, exploitation of business by its staff had become a norm. The Board has become a major impediment to improving the ease of doing business and creating an enabling environment for industrial expansion and economic development. According to Secretary to Prime Minister, after careful consideration of the issue, the EDB shall be dissolved with immediate effect. According to the letter, the Prime Minister has desired that the Ministry of Industries and Production shall immediately initiate a summary for the Prime Minister’s order on the modus operandi to be adopted for the expeditious implementation of the decision of the CCoE regarding dissolution of the EDB. The Secretary to Prime Minister further conveyed the directives of Prime Minister that the summary should include proposals relating to the future of employees of the Board and the disposal of its assets. The Ministry must also identify those regulatory functions of the Board that are absolutely essential, if any, and indicate as to which federal government institution is best placed to perform them. Any changes in the current regulatory framework entailed by the dissolution of the Board must also be specified. Minister for Industries and Production, Ghulam Murtaza Khan Jatoi has supported the directive of the Prime Minister and refused to meet the officials

of EDB at his residence, who are seeking his support against the Prime Minister’s directives. According to a former EDB official, the organization has no legal footing, adding that it was established through an Executive Order which can be dissolved under an Executive Order. When contacted, a senior official of the MOI&P said the Prime Minister‘s decision is conveyed to Minister Ghulam Murtaza Khan Jatoi the EDB has share its views on the Prime Minister’s decision and seek his guidance for further line of action.

The organization is an old and ex p erie nce d o ne a nd t h e questions that would be raised within the Ministry are: if EDB is dissolved which other organization will carry out its functions? To what extent is it indispensable? And will there be any need for a new organization to interact with the industry. In our opinion EDB should continue its functions. Room for improvements are always there. However in a latest move i.e on 20-062017 Ministry of Industries and Production has officially granted permission to three new companies for setting up car assembly plants in Pakistan. The names of companies are as under:

1 . K i a Lu c k y M o t o r s Pakistan Ltd. 2. Hyundai Nishat Motors (Pvt) Ltd. 3. United Motors (Pvt) Ltd. It is said to be that these companies will bring a total investment of $372 million. Kia-Lucky Motors will invest $190 million, the biggest sum, followed by Nishat Group with $164 million and United Motors at $18.1 million. A notification was issued to the above mentioned companies by MIP. It stated that: The government of Pakistan is pleased to award the Category-A Greenfield Investment Status to United Motors (Pvt) Ltd, Kia Lucky Motors Pakistan Ltd and Hyundai Nishat Motors (Pvt) Ltd for assembly/manufacture of vehicles covered in the exclusive contract agreements. Congratulations to all three companies being the first beneficiary of the New Auto Policy 2016-21.

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Exclusive article by Owais Khan

PAMA keeps mum, stakeholders divided over EDB’s disbanding Ministry of Industries and Production in action At a time when the fate of EDB hangs in balance, the Ministry of Industries recently granted permission to three new companies out of nine companies to set up their vehicle assembly plants

The Economic Survey 2016-2017 is full of p raise for t he Eng in eeri ng Development Board (EDB) by counting various initiatives taken by the strong arm of Ministry of Industries. The Survey came out in May 2017 otherwise if it was issued in June, it would have ignored the EDB as the EDB has been hitting the headlines of various print media in June regarding its closure over poor performance and creating hurdles for new entrants. EDB is the apex government body under Ministry of Industries and Production entrusted to strengthen engineering base in Pakistan. The Board focuses primarily on the development of engineering goods and services sector on modern lines enabling it to become technologically sound and globally integrated. The Survey 2016-2017 counted various initiatives taken by EDB like setting up a stall with collaboration of Ministry of Industries in CPEC Summit and EXPO held at Pak China Friendship Centre in Islamabad in August 2016, Hannover Messe Germany 2016-2017 in which 32 prominent engineering companies participated. EDB brought Pakistan’s best emerging companies to showcase Paki st an’s en gin eeri ng man uf acturing products at leading technology fair. If the EDB is really an impressive government’s organization as praised by the Economic Survey then what has

suddenly gone wrong that the Prime Minist er Nawaz Sharif is now determined to close down the supporter and promoter of country’s engineering sector. Surprisingly only Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) has come for the rescue of EDB to some extent, otherwise the strong lobby of Japanese bike and car assemblers – Pakistan Automotive Manufacturers Association (PAMA) has kept a mum so far. Why PAMA is playing safely and PAAPAM is taking keen interest to shield EDB is surprising as both have their interest and lobby in the EDB.

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Monthly AutoMark International

The Ministry is scrutinizing the documents of other applicants. The decision comes days after the Prime Minister’s Office decided to abolish the EDB on allegations of corruption and creating hurdles in the way of setting up new car manufacturing. The government awarded the Category-A Greenfield Investment status to United Motors (Pvt) Limited for assembly/manufacture of vehicles covered in the exclusive contract agreement, says a notification issued by the Ministry of Industry. Similar notifications have also been issued to two other companies. These firms had submitted detailed business plans and relevant documents to the EDB for assessment. and on the other hand creating hurdles through EDB in arrival of new entrants. Print media has surfaced the negative role of EDB in creating hurdles for new entrants. He said these four players are also responsible in using various SROs in their interest on which EDB is one of the main promoters of supporting discounted SROs. “I call these SROs as official smuggling order (SROs),” chairman APMA Mohammad Sabir Sheikh said. Formed under a Prime Minister’s executive order, EDB has been notorious in introducing deletion programs under which no new industries were set up especially car industry and only few players enjoyed a complete monopoly for the last many decades, APMA chief recalled. Then Tariff Based System (TBS) came in 2006 but the EDB kept amending SROs every year due to which the system became a failure and only few companies were benefitted, he said. The PML-N government had given new Auto Policy 2016-2021 but in the last one year the EDB had suspended approvals for issuing new production certificates, IOR, permission for importing machinery for plants on zero penalty, APMA chief said. “I think there is no need to keep EDB alive for the support of auto sector as this department is not entertaining the industry but is actually giving threat to small and medium units,” Sabir said. The FBR should issue S Form directly to the auto sector for the import of CKDs, raw materials, assemblies, sub assemblies, components and sub components instead of issuing of IOR and production certificates/production quotas through EDB. Some of the corruption can be gauged

from the fact that the Ministry of Industries and the EDB had always been in forefront in supporting wrong practices of the old car and bike players. It had never taken any strict action against late delivery of vehicles ranging between three to four months to the buyers coupled with heavy premium being charged by the authorized dealers of local car assemblers. The EDB’s top brass had never raised their eyebrows over frequent increase in prices of cars and even two wheelers by the assemblers when demand soars. Pak Suzuki has been rolling out decadesold models since its inception but the Ministry and the EDB had never enquired as to why Suzuki Mehran, Ravi, Bolan etc, which do not exist in the world, are still being assembled in Pakistan. There are no safety standards in these vehicles and consumers cannot access their price in other countries through website as these are only assembled in Pakistan. For the last two to three years, Honda bikes have become extraordinary items which are not available in showrooms d es p it e t h ei r re co rd br eak in g production. Its authorized dealers are

openly charging extra premium in order to make a quick buck. The dealers are giving 30-45 days time to the buyers who book Honda bikes since these are not readily available on spot sales. Coming back to other vehicles, sources said that most of the new entrants, who have applied for Greenfield projects mainly are worried as the EDB officials are excusing them to deal their cases after reports of EDB closure. Anxiety prevails among the new entrants as to which government’s department or relevant ministries will deal their new investment cases as no department has solid background of dealing auto sector previously. They said so far the government has notified disbanding EDB but the officials of the EDB have stopped entertaining new investors as well as old players. At a time when the fate of EDB hangs in balance, the Ministry of Industries recently granted permission to three new companies out of nine companies to set up their vehicle assembly plants. The cumulative investment to set up assembly plants under Greenfield investment by United Motors Private Limited, Kia-Lucky Motors Pakistan and

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Monthly AutoMark International

Automotive News - Update

Chairman Association of Pakistan Motorcycle Assemblers (APMA), Mohammad Sabir Sheikh, offering a different view, said the EDB operates under the Ministry of Industries and Production but it is so powerful that it sometimes it looks “God Father” of its own Ministry. He said the EDB has a good backup support from strong auto mafia of Pakistan especially three car assemblers and one Japanese bike assembler. The EDB supports these four players and in return the four players support the Board. Nishat Group stands at $372 million. The Ministry is scrutinizing the documents of other applicants. The decision comes days after the Prime Minister’s Office decided to abolish the EDB on allegations of corruption and creating hurdles in the way of setting up new car manufacturing. The government awarded the CategoryA Greenfield Investment status to United Motors (Pvt) Limited for assembly/manufacture of vehicles covered in the exclusive contract agreement, says a notification issued by the Ministry of Industry. Similar notifications have also been issued to two other companies. These firms had submitted detailed business plans and relevant documents to the EDB for assessment. United Motors would set up a plant with Chinese collaboration. The Nishat Group will be in partnership with South Koreabased Hyundai Company and Lucky Cement would also collaborate with another South Korean firm, Kia Motors. It is surprising how the Ministry of Industries can grant approval directly as Auto I nd ustry Develop ment Committee (AIDC) is responsible in giving green signal to the new entrants. First the companies apply in the EDB and after proper scrutiny the EDB refers the case to the AIDC where all stakeholders unanimously approve or reject the case. The 24th AIDC meeting saw request of Regal Automobiles for its green field investment incentives followed by brown field investment project by Daehan Dewan Motor Company Limited and green field investment project by Al Haj Faw Motors Limited on which the decisions were taken in the AIDC. The AIDC had mentioned in the minutes that it had received application for investment from United Motors, Habib Rafiq Limited, Kia Lucky Motors Pakistan, Pak China Motors and Khalid Mushtaq Motors in green field projects. As per AIDC minutes no decision was

taken on the above projects. The new Auto Policy 2016-2021 had lured new players, barring European companies, due to tax incentives to new entrants. Sources said in one of the cases two Chinese assemblers are fighting for the rights of introducing a vehicle. Master Motors claims its right while its opponent also claims the right of Forland brand. EDB tried to solve the issue by seeking copies and relevant original agreements. In China – many well organized assemblers have given the rights to other companies to make brand. Anybody can enter into technical and manufacturing agreements with them. Chairman PAAPAM Mashood Ali Khan said the government is shutting down the EDB and the decision was taken in a meeting in which stakeholders from the engineering industry were not invited. Unfortunately, during the last two years tenure of the outgoing CEO EDB, the above strength of EDB was totally eroded by this specific individual, due to his incompetency, inadequacy and malfeasance. His maladministration exceeded all limits, as he bypassed the apex body, AIDC, and assumed dictatorial powers, he said. The current problems of EDB therefore do not lie with the institution; rather the blame falls squarely on the shoulders of the then head of this institution. All credit goes to the government that it did not renew the contract of the then CEO of EDB. The next right thing to do should be the appointment of the right person for this vacant position of CEO EDB, he said. Closure and shifting the responsibility of EDB, would derail the engineering industry, specially the auto sector, would lead to inefficiency in the government, and lack of expertise would further complicate the situation, leading to stoppage of investments in auto sector, especially the vending sector, he

said. He urged the government to take back the proposal of disbandment of EDB and a professional CEO EDB should be appointed, based on capability to handle such an organization. Powers of AIDC should be revived and formalized, to ensure a strong system of checks and balances on all EDB ongoing issues. As per print media, Ministry of Industries and Production (MoI&P) is reportedly hesitant in removing acting Chief Executive Officer (CEO) EDB, Mirza Nasir Baig even after rejection of his summary as permanent CEO by the Prime Minister. The Cabinet Committee on Energy (CCoE) headed by Prime Minister has also directed the closure of this corruption-tainted organisation with immediate effect. On June 9, 2017, Secretary to Prime Minister, Fawad Hasan Fawad wrote a letter titled "appointment to the post of Chief Executive Officer, Engineering Development Board (EDB)" to the Ministry of Industries and Production and explained the reasons for winding up EDB. The reasons included corruption and malpractices. The key section of the EDB which is involved in malpractices is tariff section, which is being headed by the present incumbent CEO for years. The Secretary to Prime Minister stated that during the meeting of Cabinet Committee on Energy (CCoE) chaired by the Prime Minister on May 29, 2017, it was observed that EDB was not performing any useful function, either in terms of regulation or promotion of engineering enterprises, adding that malpractices had become endemic in the Board, exploitation of business by its staff had become a norm. The Board has become a major impediment to improving the ease of doing business and creating an enabling environment for industrial expansion and economic development.

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Automotive News - Update

Chinese team to visit proposed sites for SEZs under CPEC A high-level Chinese delegation will arrive Pakistan in the last week of July to visit the sites proposed for setting up Special Economic Zones (SEZs) under the China-Pakistan Economic Corridor (CPEC) and discuss their feasibilities with Pakistani counterparts. A spokesperson of Board of Investment (BoI) told Business Recorder that nine sites for SEZs have been declared as priority sites under the CPEC and all provinces, FATA and Gilgit-Baltistan have been allocated SEZs. These sites have been identified by the provincial governments and there is close coordination between the federal and the provincial governments. He further said the objective of the SEZs, which were open to all investors both Pakistani and foreign, was also to attract the companies from China which would be relocated out of China in coming years. With the ownership of provincial governments, the spokesperson said all proposed nine industrial zones under CPEC would be completed in a period of two to three years. The federal and provincial governments had jointly proposed location of these SEZs to China, which were approved at a joint meeting. The approved sites include Bostan in Balochistan, Rashakai in Khyber Pakhtunkhwa, Dhabeji in Sindh, Sheikhupura in Punjab, Moqpondas in Gilgit-Baltistan, Bhimber in Azad Kashmir and Mohmand in FATA, and federal government's sites are in Islamabad and Port Qasim,

Atlas Battery approves plant expansion

The board of directors of Atlas Battery in their meeting on last month approved the annual budget of the company for 2017-18. They also approved capital expenditure of Rs1.42 billion for expansion of production capacity, the company notified to the Pakistan Stock Exchange.

Karachi . Sindh and Khyber Pakhtunkhwa are more active than other provinces for operationalising the SEZs, as announcement of incentive packages will help attract early investors. China also wants joint ventures between Pakistani and Chinese companies but so far except for a few cases, no major collaboration has been occurred. An informed source said the federal and provincial governments wanted to accelerate the construction of new industries in the SEZs before the next general elections. He maintained that the federal and provincial governments were considering to offer tax incentives to investors setting up industrial units in SEZs. In other additional incentives, the spokesperson said that discussion had been under way with Ministry of Water and Power and Ministry of Petroleum and Natural Resources to provide power and gas in bulk to developers of those nine proposed industrial zones. He said Board of Investment had been actively engaged with both line ministries for provision of power and gas on war footing basis. The federal government had announced a plan to establish 29 SEZs in all four provinces, Islamabad, Kashmir and Gilgit-Baltistan in November 2016 out of total 48 recommended sites by provincial governments. Courtesy: Business Recorder

PAMA welcomes new entrants in auto industry Pakistan Automotive Manufacturers Association (PAMA) has appreciated the Govt, BOI and MoI’s efforts to attract new investment in the auto sector and has termed the newly approved Auto Policy a catalyst for attracting new entrants. In a statement released on Thursday, DG PAMA said, “We have participated while the new policy was being formulated and have always supported entry of new investment in the auto sector; as it would help increase the market size, increase the choice to customers and, above all expansion and growth would benefit everybody.”

Paapam seek removal of regulatory duty Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) Chairman Mashood Ali Khan has stated that regulatory duty is damaging the auto engineering sector, pushing more companies towards closure.

Auto industry seeks tax relief at retail stage He called as unjustified the 30% regulatory duty on products that were not being produced in the country. Some of them that were being manufactured in the country were not of good quality that the auto industry needed. “The auto parts’ making industry is on the verge of collapse due to the regulatory duty imposed for three fiscal years,” said Khan. The duty was slapped at a time when t he g ov e rn men t be li ev e d t ha t international steel prices would continue to remain low. But now, he said, international prices had been on a constant rise, making it even more difficult to bear the burden of regulatory duty. “Many industrial units are nearing closure and up to 200,000 employees are on the verge of losing their jobs. Pakistan’s exports have dropped only because we have become 30% more expensive than our competitors due to this duty,” he added. As per the new five-year auto policy, which was announced on March 21, 2016 with a comprehensive tariff structure, he said, it was unjustified to modify its approved tariff structure through the levy of regulatory duty and additional customs duty on raw materials that were not manufactured locally.

China to build automobile city in Gwadar The auto parts’ manufacturers requested the government that imports of raw materials should be exempted from the regulatory duty as similar exemptions had also been granted to other sectors.

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Automotive News - Update

AN EXCLUSIVE INTERVIEW WITH ANWAR IQBAL Anwar Iqbal has a diversified experience comprising a range of industrial and business including petroleum, banking, pharmaceutical, fast moving consumer products and most of all the automobiles. He did his Master of Arts from the University of Karachi and did Master of Business Administration in Marketing and Management from the US. He started his career in 1982 with US multinational petroleum company, Esso Eastern Inc. and has since worked with a number of other multinational companies including Union Texas Petroleum, Squibb Pakistan and Singer Pakistan. He was also associated with a number of prestigious national companies including Bankers Equity, Jaffer Brothers, etc. he has been actively involved with the automobile sector since 1990 and has been associated with Raja Group of Industries and also helped establish Fateh Motors where he entirely conceived and executed Hero Motorcycle. He as the Chief Operating Officer of Dewan Motorcycle Limited, the producer of Start brand two-wheelers and commercial vehicles. He also worked as senior group advisor in Habib Group. Automark: Tell me something about yourself, please:

mak in g p os it i on s w it h D ew an Motorcycles, Habib Motorcycles, Fateh Motors Ltd, and is the Chairman of Pak China Cultural and Businessman Society. I remember my early association with the Pakistani auto industry with fondness because that reminds me of days, full of challenges and struggle/ “My first big break came when I got engaged with working in China on the conversion of light commercial vehicles comparable to locally produced Suzuki pick-ups from petrol to diesel in 1992. At that time, right-hand drive vehicles were not available in China and so was the case with the diesel version of the pick-up under discussion. I asked for these two conversions. I managed arrange a financing of $100,000 for the conversion project and we also supplied the parts and the accessories that were flown out of Pakistan. I worked under extremely cold weather in Hefei, China and managed to convert 500 vehicles to diesel and right-hand drive. First of these ten converted vehicles were imported in to the country but the import of the remaining vehicles was halted due to financial constraints. During frequent visit to China I also managed to find a compatible 70cc motorcycle in China. This model was for domestic consumption and different in many ways with the requirement of Pakistani market. Once again my R & D

trips (Pakistan – China – Pakistan) started. It tooks more than three months to create an acceptable 70cc model for Pakistani market of which some 500 units were ultimately imported in to the country. At last in the year 1999, I founded my own consultancy company, Silver Seal International. Silver Seal is basically an auto and related consultancy company that offers a full range of products and services to help the financiers and entrepreneurs make right decisions. Automark: Give your views on automobile sector of Paki stan: AN W AR I QB AL: Pa k i s t a n’ s Automotive Industry is the one of the fastest growing industries of the country, accounting for 4% of Pakistan’s GDP and employing a workforce of over 1,800,000 people. Currently there are 3200 automotive manufacturing plants in the country, with an investment of ?.92 billion (US$880 million) producing 1.8 million motorcycles and 200,000 vehicles annually. Its contribution to the national exchequer is nearly ?.50 billion (US$480 million). The sector, as a whole, provides employment to 3.5 million people and plays a pivotal role in promoting the growth of the vendor industry. Pakistan’s auto market is considered among the smallest, but fastest growing in Sou th Asia. At present, the automobile market of the country is dominated by Honda,

ANWAR IQBAL: I am the Chief Executive Officer of Silver Seal International, an auto consultancy firm specializing in all segments of the industry from two-wheelers, cars, buses, trucks and commercial vehicle. For two decades I have been playing an extremely proactive role in various capacities and at various levels in the auto and related industry. I first visited China in 1987 when Pakistani automobile market was heavily dominated by expensive Japanese, and to some extent European, products. The aim of the visit was to explore ways to find inexpensive auto products and was successful as I managed to import a four-stroke 70cc motorcycle and a 1000cc pickup. By late eighties I managed to broaden the base of my work to the conversion of 1000cc petrol engine into diesel engine, once again from China, as I visited the country at least two-dozen times between 1987 to 1989. Every single of these trips, was meant to carrying of excess baggage that is mostly consisted of engine parts. During this time I managed to convert a left-hand drive vehicle in to right-hand drive vehicle to make them fit for plying on Pakistani roads. The protype resulted in the conversion of 25 more vehicles in China. I have been worked in high decision www.automark.pk | July-2017 | Page 26

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Monthly AutoMark International Toyota and Suzuki. The biggest reason that why these three brands dominated in the Pakistani market is that they know what kind of product best suited according to the customer, environment, roads and market. Pakistan's automobile industry is reaping fruits of economic turnaround as sale of cars has increased by 24pc in first seven months of ongoing fiscal year. Similarly, sale of tractors has witnessed massive upward trajectory of 85pc in country's urban areas during same period. Sales and production data o PAMA revealed that sale of 104, 000 automobile units in first seven months of fiscal year 2016-17 while only a total of 180, 000 units were assembled in fiscal year 2015-16. In the backdrop of new auto policy 2016 and surge in passenger car sales, Pakistan's booming car market is attracting global attention as renowned automobile conglomerates from across the globe are ready to pour investment. One hard fact is that a buyer has to pay Rs180, 000 to Rs200, 000 over immediate delivery of Toyota car depending upon the colour whereas on vehicle of Honda, own price goes up to as much as Rs350, 000. Under new automobile policy, a car manufacturer is bound to make delivery of vehicle to client within two months and if fails in doing so, he is bound to pay penalty but practicaly assemblers are no t fol lo wi n g g ov er nmen t instructions.The overall sales volume has increased by 3K (2%) between the comparison periods: 2015-16 and 201617. However on 19 March 2016, Pakistan passed the “Auto Policy 2016-21”, which offers tax incentives to new automakers to establish manufacturing plants in the country. In year to come we may see some new international brands on pakistani roads. Automark: Give your views on smugling: ANWAR IQBAL: There is no doubt smuggling is a big problem for an indigenous industry same is the case of Pakistan motorcycle industry. However I will repeat my earlier statement that under invoicing misdecleration is a more big threat for Pakistani motorcycle industry I call it systemize and scientific smuggling. Unfortunately major motorcycle assemblers and parts vendors are involved in this racket. Indigenization should have played the key role in

optimizing cost by following Indian experience. Since Pakistan has failed in developing heavy as well as light engineering industry. It has remained heavily dependent on imported components. On the top of this failure is inconsist ency in government industrial and business polices. Automark: Your views on 'Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) and PAMA (Pakistan Automobile Manufacturers Association): ANWAR IQBAL: PAAPAM and PAMA have key role in Pakistan automotive industry PAMAM is the association of auto parts manufacturers. Tremendous growth were seen in auto vending industry in last one decade. This is mainly due to growth in motorcycle and three wheeler industry u nfort unately motorcy cle parts producers / vendors are the most neglected segment in this association. You can check the names of office bearers for 10, 15 years. You will find repetition of some names and more than 90 percent belong to car parts manufacturers. Now country enjoys democracy it should be reflect in all institutions. Same case with the PAMA. It always reluctant to allow membership to motorcycle assemblers, behaves like a private club. This attitude / practice also creates problem for formulating policies and future planning because PAMA is the source of providing periodical statistics for production and sales of automotive in Pakistan. So unable to report the production and sales data of non members. Interestingly the numbers of non members are more than PAMA members. Automark: Pakistan is one of the most competitive global manufacturers of 2-wheelers that has now geared up into the export markets. Your comments please: ANWAR IQBAL: As I mentioned earlier, we are assembling 70cc motorcycle which is now almost obsolete all over the world. This 70cc motorcycle technology is 50 years old. You can say technologically we are far behind with the rest of the world. This is due to lack of research and development which is the major obstacle for the growth of all segment of the auto industry. This lack of interest in R&D on the mindset of manufacturers as well as vending industry who do not want to take a risk. Though Pakistani auto vending industry

has manage to improve the quality of its products which surpass the quality of products produced by India as well as China it keeps on losing the share of the market consistently due to its passion with quick overnight profits. This tendency should be checked or else it would ultimately hurt the quality that would result in long term loss. Measures should be taken to reduce the high cost of production that render the parts and accessories in-competitive not only locally but also internationally to discourage import of both the finished products and replacement parts in the international markets. It is imperative to ensure development of quality and qualified auto-specific human resources. Specialized degree and diploma courses should be offered in engineering university (NED Engineering University is already offering four-year degree in Auto Engineering) and vocational institutions to address the acute lack of quality and qualified professionals. Measures should be taken to provide hands-on training opportunities to auto engineers, technicians and skilled workers to ensure quality. Appropriate certifications for institutions and individuals be ensured to ensure standard and quality of an individual or an institution. After that we may geared up to enter in global export market. Before that I do not see any export potential for our motorcycle product. Exporting some vehicles to Afghanistan or to some African countries is not significance. Automark: Give your comments on taxes: AN WAR I QBAL : Norma lly government increase tax rate to minimize deficit in budget target of national exchequer. In our case increase in sales tax is not a remedial measure. FBR should ensure proper collection of sales tax. It should evolve such a system for tax collection thru which tax evasion / fraud / theft should be minimize. In case of motorcycle it is commonly known that some of the major player of industry are involved in sales tax evasion, fraud and theft. As I keep a close eye on the auto industry of Pakistan so I am able to offer a complete foolproof solution to the FBR specially sales tax collection from motorcycle assembler and vendors industry. I am sure the tax collection amount will increase tremendously even if sales tax rates may fix at 10 percent.

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Automotive Event - Media Coverage

Monthly AutoMark International

FUTURE MOTORCYCLE PARTS - ANNUAL PRIZE DISTRIBUTION CEREMONY 2017

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Lubricant’s analysis - Update

A new study finally tells car owners whether traditional or synthetic oil is better

If you're a good car owner and follow a reasonable maintenance schedule, you most likely change your oil at least twice a year. Scrupulous drivers do it more often, using the traditional "every 3,000 miles" rule. But a big question comes up when undertaking this basic task, either yourself or at a professional garage or oil-change location: traditional or synthetic oil? There are two considerations when making that call: cost and quality. Everybody knows synthetic costs more. But is it worth it? AAA conducted an extensive scientific analysis to find out. The results, published earlier this month, aren't shocking, but they could guide consumer behavior toward spending a bit more money to get a long-term review.

Synthetic is better. A lot better "Synthetic oil out perf ormed conventional oil by an average of nearly 50 percent in its independent evaluation, offering vehicles significantly better engine protection for only $5 more per month when following a factoryrecommended oil change schedule," the organization said in a statement. In the study, AAA found that "synthetic engine oils performed an average of 47 percent better than conventional oils in a variety of industry-standard tests," John Nielsen, the organization's managing director of automotive engineering and repair, said in a statement. "With its superior resistance to deterioration, AAA's findings indicate that synthetic oil is particularly beneficial to newer vehicles with

turbocharged engines and for vehicles that frequently drive in stop-and-go traffic, tow heavy loads or operate in extreme hot or cold conditions."

Worth it to spend a little more A lot of drivers already kind of knew that. I did, but there have been plenty of times when I opted for "dinosaur oil" over the higher-tech and pricier synthetic stuff. AAA was quite honest about the findings. You aren't going to hurt your engine if you skip the Mobil 1, one of the best-known synthetics. But you aren't going to put yourself in the poorhouse if you flip for the synthetic, either — these oils add only $64 a year on average to vehicle-operation costs. You might think you're being upsold at the oil-change place. But the upsell pays off f or you and the mechanic. AAA didn't go light on the research. The report it produced is a deep dive into these lubrications. "AAA's engine oil research focused on ei ght in dust ry - stan dar d A STM

(American Society for Testing and Materials) tests to evaluate the quality of both synthetic and conventional engine oils in terms of shear stability, deposit formation, volatility, coldtemperature pumpability, oxidation resistance and oxidation-induced rheological changes," the organization said. I've been opting for synthetic for a few years now because I figure it would cover me better than changing the oil more often. It is important to remember that you don't need to go synthetic if cost is an issue — that's the catch. When my 1998 Saab 900S was on its last legs, I went back to conventional for oil changes. I wasn't going to deprive myself of a decent bottle of wine for that jalopy. However, if you own a newer car or want to maximize the long-term value of your vehicle, AAA's advice is clear: pay the extra money for the extra protection. Courtesy: http://www.businessinsider.com

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Monthly AutoMark International

Automotive News - Update

Tractor subsidy scam involving Rs1.45b On 7th March 2017, a complaint was rece i ve d i n An it Co rr upti on Establishment, alleging commission of massive corruption in tractor subsidy scheme, run by Agriculture Department, Government of Sindh, and private persons. Subsequently, record was seized through raids at Agriculture Department and accused persons house. After raid, record was seized from Agriculture department and was analysed, which showed that Accused Shehzad Riaz CEO M/s. Shehzad Trade Link, agent of Belarus Tractors, worked as a dealer to deliver tractors to growers, who emerged successful in ballot, under subsidized tractor scheme from 2009 to 2012. The dealer, Shehzad Riaz was supposed to deliver tractor to grower and claim subsidy of Rs.300000/= per tractor from Government of Sindh. As many as 5780 tractors were purportedly delivered by him to growers. But actually on ground, he did not do so. Rather, by issuing fake invoices as well as sale certificates, he received subsidy of Rs.1.45 Billion, fraudulently. Whereas,

in fact he sold off tractors to other purchasers on the price of his choosing. He, engaged many dealers across Sindh pr ov i n ce t hro ugh t wo d ummy companies M/s AR enterprises and M/s MI enterprises, which he had actually registered in the names of his own employees namely Amir Rafiq and Muhammad Imran, respectively. He got the tokens from growers and used them coupled with fake invoices to claim subsidy, fraudulently. Dealer was supposed to collect pay orders from growers and deliver tractors to the same person and collect subsidy from the government. However record reveals that Shahzad Riaz deceitfully claimed to had received cash payments and generated invoices in the names of growers and claimed subsidy from the government. In fact, he had purchased token from growers, without delivering tractors. Upon verification during investigation, Hundreds of growers have admitted to had never received tractor but a nominal amount against token they had by Shehzad Riaz through his dealers. Besides, out of 45 dealers, 29

Tractors sale continues to surge The tractors sales witnessed an upsurge of 41 percent to 5,663 units in May 2017, resulting in 65 percent growth during 11 months of FY17 to 50,546 tractors due to the reduction of GST to 5 percent from 16 percent on tractors. During the month, MTL witnessed an astronomical growth of 53 percent YoY to 5,663 tractors while AGTL managed a 25 percent YoY rise to 2,211 tractors, respectively. With an agriculture friendly FY18 budget and low cost financing, it is anticipated strong demand for tractors to continue on the back of provincial subsidies and lower retail prices as GST rates fall. PAMA released its latest data for May 2017 where Pakistan’s locally assembled passenger car sales saw a growth of 16 percent YoY to 20,720 units while MoM sales also jumped by 11 percent. However, during 11MFY17, volumes declined by 3 percent YoY to 197,657

units. The MoM surge in volumes came on the back of impressive HCAR sales coupled with record sales for PSMC’s Wagon R &Cultus even as INDU saw a drop in volumes of 13 percent MoM. During May 2017, HCAR volumes showed a massive growth of 86 percent YoY, while PSMC volumes rose by 24 percent & INDU volumes saw a fall of 11 percent YoY, respectively. Further, HCV sales showed a robust growth of 22 percent YoY in May’17, while 11MFY17 volumes grew by a huge 36 percent YoY to clock in at 7,907 units against 5,818 units. Also, tractors sales have bounced back after a dim start to the fiscal year to 5,663 units in May’17, up 41 percent YoY with support coming from MTL & AGTL, both of which increased sales volume by 53/25 percent YoY. This surge can be attributed to implementation of reduced GST rates and improved farmer income.

have deposed under section 161 crpc and some U/s 164 crpc, respectively, to had purchased tokens at the behest of Shehzad Riaz, without delivering tractors to growers. On the one hand, accused Shehzad Riaz got subsidy by issuing an invoice showing delivery of tractor to grower in each single case, on the other hand he issued parallel invoices bearing same engine and chassis number of tractor to routine customers, which he indicated while claiming subsidy. Thereby, he got double profit of subsidy and sale of tractors at price of his choice, instead of fixed price of Rs.1035000/= per tractor, which he had agreed to charge in subsidy scheme. Size able number of fake invoices have been seized, which were doubly used for feigning delivery of tractor to grower on the one hand in Sindh, and same invoice bearing exactly same chassis and engine numbers were sold to dealer in Punjab. Same invoices & sale certificates were used by accused to receive subsidy amounting Rs.1.4 Billion, fraudulently, without delivering tractors to poor growers. Evidence is on record showing making of as many as 1200 fake pay orders purportedly issued from a single branch of bank, from the account of accused for receiving subsidy, illegally. Besides, double invoicing fraud, he managed registration of the subsidy scheme tractors in the name of market purchasers in Excise Department by issuing sale certificates bearing same engine and chassis numbers, which he had given in Agriculture Department in the form of invoice issued by him for claim of subsidy. In this regard, Excise Dept. after verification has generated a report to ACE. So many witnesses have denied receipt of tractors as shown in fake record by accused. His bank accounts show transactions from Punjab dealers confirming sale of same tractors to Punjab, which were shown into claim of subsidy. Courtesy: Pakistan Observer

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Transportations News - Update

Chinese investors show interest in urban transport sector A Chinese delegation on Tuesday met the officials of Lahore Transport Company by showing their interest to invest in urban transport sector, particularly in projects pertaining to airport shuttle service by plying luxury buses to commute passengers from airport to hotels located at different places in city on dedicated routes, while under bus drivers training simulator project drivers of public service vehicles will be properly trained. It was discussed in the meeting that Chi nese co mp any wou ld make investment to bring buses as well as establish state of the art setup for Drivers Training Simulator programme. Most importantly the Chinese company will not get any subsidy from the government rather LTC will facilitate them to commence their operations and route plan will be shared accordingly.

This meeting was attended by Chinese delegation led by CEO Mr Wang Lixu Wow Solution and Mr Zhao Lei Office Manager from Fulin Transport Co. On this occasion Chief Executive Office LTC Mr Khawaja Haider Latif, Chief Financial Officer Mariam Khawir, Chief Operating Officer Zafar Qureshi, DGM Technical Abdul Qayyum and other officials were also present in the meeting. Wang Lixu has said that his company will also share their model for induction and operation of dedicated luxury buses for Airport on specified routes; he appreciated the various initiatives of LTC for the provision of safe, affordable and efficient transport facilities. CEO LTC briefed the delegation about various init iatives of organisati on and highlighted the possible benefits for potential investors.

CM warns of heavy fine over delay in rapid bus project in KPK Khyber Pakhtunkhwa Chief Minister Pervez Khattak has ordered the successful execution of the Rapid Bus Transit project in the provincial capital within six months and warned that heavy fines will be imposed on those responsible for delay in this regard. “This vital project of urban transport must be completed within six months or earlier. Heavy fine should be imposed on the culpable persons in case of any delay in this regard,” he told a meeting at the Chief Minister’s House on last week. Among the participants were Asian Development Bank representatives led

by the regional director, senior minister Sikandar Sherpao, transport minister Shah Mohammad Wazir, the CM’s focal person for Peshawar’s mega projects Shaukat Yousafzai, Peshawar nazim Arbab Asim Khan, CM Complaint Cell chairman Haji Dilroz Khan, chief secretary Abid Saeed, additional chief secretary Azam Khan, administrative secretaries, senior officials of the relevant departments and organisations. The Khyber Pakhtunkhwa Urban Mobility Authority officials gave a presentation on the proposed bus service.

Monthly AutoMark International

LTC mulls over plan to start airport shuttle service The Lahore Transport Company (LTC) and a Chinese company have planned to start an airport shuttle service by plying luxury buses to commute passengers from the Allama Iqbal International Airport to hotels located in different parts of the city on dedicated routes. A spokesman for the LTC said that a Chinese delegation met the Lahore Transport Company officials on Tuesday, and showed their interest to invest in urban transport sector. He said that a state-of-the-art set up for drivers training simulator programme would also be established with the help of Chinese investment. "The Chinese company will not get any subsidy from the government," he said, adding that the LTC would facilitate them to commence their operations. This meeting was attended by members of Chinese delegation, including Wang Lixu and Zhao Lei from Fulin Transport Company. LTC Chief Executive Officer (CEO) Khawaja Haider Latif, Chief Financial Officer Mariam Khawir, Chief Operating Officer Zafar Qureshi, DGM (Technical) Abdul Qayyum and other officials were also present in the meeting. He quoted Wang Lixu as saying that his company would also share their model for induction and operation of dedicated luxury buses on specified routes. He also appreciated various initiatives of LTC for provision of safe, affordable and efficient transport facilities to Lahoris. The LTC CEO briefed the delegation about various initiatives launched by the company and highlighted possible benefits for potential investors.

PMA to start plying 100 new metro buses in Multan The Punjab Mass Transit Authority (PMA) will start plying one hundred new buses on feeder routes for Multan Metro Bus service from next month. The feeder bus service will connect the

rest of the city with the corridor of the Metro Bus, Radio Pakistan reported on last month. According to the PMA spokesperson, buses have already arrived in Multan

and this air-conditioned latest bus service will facilitate seventy-five thousand people daily to approach Metro Bus stations.

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Monthly AutoMark International

Automotive News - Update

Revealed

The best (and worst) carmakers for customer service JD Power has published its annual Customer Service Index, which is based on drivers who registered a new vehicle between February 2014 and April 2016. Each brand is given a score out of 1,000 for overall satisfaction. Join us as we count down all 22 carmakers in the survey – from worst to best – and reveal their scores.

More car buying advice on Motoring Research: 22. Fiat: 746 points Fiat sits at the bottom of the pile, despite scoring 746 points, which is up from 728 points in 2016. The study measures customer satisfaction with their service experience at a franchised dealer for maintenance and repair work. In 2017, 6,753 respondents took part in the survey.

21. Citroen: 749 points Five measures are examined (listed in order of importance): service quality, service initiation, service advisor, vehicle pick-up, and service facility. Citroen falls from joint 11th in 2016 to 21st in 2017.

20. Volkswagen: 754 points Oh dear. Of the Volkswagen Group ‘big four’, VW is rated the worst. Volkswagen drops from 14th to 20th, despite scoring seven points more than in 2016.

19. Nissan: 757 points Nissan won’t be too pleased with 19th place on the list, but at least it’s an improvement on the 20th position of 2016. In addition to the Note (pictured), Nissan builds the Qashqai, which is Britain’s most popular crossover.

18. SEAT: 759 points From 10th to 18th in the space of the year, SEAT has work to do if it wants to make a return to the top 10 in 2018. The new Ateca crossover will deliver the sales but SEAT must deliver the after-sales.

17. Ford: 760 points Ford has more UK dealers than any other carmaker, but 760 points ranks it below the Customer Service Index

volume brand average of 766. Vignale customers in particular will expect more from the dealers.

16. Peugeot: 761 points On the face of it, finishing 16th in the JD Power Customer Service Index survey might seem like a poor performance, but Peugeot appears to be on the up. Last year, the French firm f ini shed 19th wit h 736 points. Meanwhile, the 3008 and 5008 are reasons to be cheerful. 15. Suzuki: 764 points Suzuki is the only other carmaker to sit below the survey average and will be disappointed to fall from 8th position in 2016. The Japanese carmaker is in the midst of a major product overhaul, which has delivered the Baleno, Ignis and Swift. =13. Skoda: 769 points We would have expected a brand that prides itself on owner satisfaction to finish higher than joint 13th. Perhaps it’s a symptom of attracting new customers to the brand. Skoda needs to gear up for the Kodiaq and Karoq owners.

=13. Kia: 769 points Last year, Kia finished fifth with 765 points, so although the score is higher in 2017, the Korean carmaker slips to joint 13th. Customers demand more than a seven-year/1000,000-mile warranty.

12. Renault: 770 points A 12th place finish is good news for Renault and a big improvement on last year. In 2016 it finished 16th with a below average score of 744 points. This year it flies the flag for the French.

11. Vauxhall: 776 points Vauxhall sits just outside of the top 10, but having finished 22nd in 2016, bosses in Luton won’t be too disheartened. All those Crossland X and Grandland X customers are in for a treat.

10. Honda: 778 points

a score of 778 points is slightly better than last year’s result, but other carmakers have made big improvements, causing Honda to slip from second place in 2016.

9. Hyundai: 783 points One such brand on the up is Hyundai, which finished 11th in 2016. The Korean carmaker offers a generous fiveyear/100,000-mile warranty and is taking giant steps in the ecocar segment with the Ioniq.

8. MINI: 785 points Having finished 7th in 2016, MINI has to be content with 8th place in 2017. On the plus side, the Customer Service Index score is up from 757 last year.

7. Mercedes-Benz: 788 points In 2016, Mercedes-Benz was the highest-placed ‘premium’ brand in the JD Power survey, but this year it’s the lowest ranked carmaker of the ‘big five’. A score of 788 puts the German company below two ‘volume’ brands.

6. Volvo: 793 points This is a cracking performance for Volvo, up from 17th place in 2016. The Swedish brand demonstrates that it has the dealers to match its premium brand aspirations.

5. Toyota: 793 points The 2017 JD Power Customer Service Index is a double-edged sword for Toyota. A score of 776 points was enough to give the Japanese carmaker an overall win in 2016, but 793 points is only enough for fifth in 2017.

4. BMW: 797 points BMW finishes fourth, up from joint 11th in 2016. It’s worth mentioning that Jaguar was included in the study but not ranked due to a small sample size. Other brands absent include Alfa Romeo, Dacia and Subaru.

3. Mazda: 800 points And the award for the biggest transformation goes to… Mazda. Last

There’s good and bad news for Honda: www.automark.pk | July-2017 | Page 40

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Exclusive Review by Syed Sarim Raza

Monthly AutoMark International

Why we need more Small Cars in Pakistan A Prospective Analysis of the Automotive Industry Buying a small car is a practical decision as small cars are adequately spacious, fuel efficient and relatively affordable than large cars. Small cars segment is one of the best-selling car segments around the world and even in a country like Pakistan, small cars can certainly be a big hit. The success story of Suzuki Mehran in Pakistan is an illustration of the potential of small cars in the country. Despite immense acceptance for small cars and a reasonable prospective customer base, the market of small cars hasn’t grown as per expectations in Pakistan. Since the automotive industry in Pakistan has been mainly led by three big Japanese automotive giants i.e. Toyota, Honda and Suzuki, car buyers don’t get too many choices when it comes to buying a small car. Only Suzuki offers small cars in the shape of Mehran, Cultus and Swift, but that’s not enough for a country where customers demand such cars in bigger numbers and wide variety. In these circumstances, the automotive industry of Pakistan clearly needs a turnaround to make space for small cars.

What are small cars? The category of small cars is dedicated for cars that are small in size, equipped with a fuel-efficient powertrain, have sufficient space for small families and are available in the market at an economical price. These cars are ideal for daily commute as they offer great mileage and this is one of the reasons why these cars are considered as best urban cars.

A Brief Analysis of Small Cars Industry in Pakistan Toyota, Honda and Suzuki have been ruling the Pakistan’s automotive industry for a long time now and car buyers have adjusted themselves with the limited choice that they have. The lack of flexibility in the automotive policy of Pakistan had always been an obstacle in the way of new car companies establishing their feet in the automotive

industry. Too many restrictions, the absence of growth incentives and unavoidable taxation and other chargeshave kept big automotive names from investing and setting their assembly/manufacturing plants in Pakistan. The already established three Japanese companies as mentioned earlier have only offered limited options when it comes to small cars and this is the fundamental reasons behind therestrained growth of small cars industry in Pakistan. The new auto policy 2016-2021 has however brought a breath of fresh airand welcomes new car companies to invest in Pakistan with some excellent growth incentives. The government has introduced incentives like Green Field Investment and Brown Field Investment to attract the attention of global car makers. Three Pakistan-based business groups in their partnership with NonEuropean companies have recently secured the Green Field Investment and have been allowed to set up their assembly plants in Pakistan. One of these companies, United Motors has also informed Automark Magazine of their plans to introduce 1000cc vehicles in Pakistan in their mutual venture with Chinese Partners. These are good signs not only for the growth of small cars industry in Pakistan but also for the overall growth of the automotive sector in Pakistan.

Why we need small cars industry to grow in Pakistan?

The industry of small cars has to grow in Pakistan because it will offer more options to customers and open new avenues of success and growth for automotive sector of Pakistan. Listed below are themajor reasons that show why small cars must be more in numbers in a country like Pakistan: • Small cars take less space so you can park them without much trouble. These are ideal cars for young drivers in Pakistan who face the maximum difficulty while parking. • Small cars are stylish and classy. They offer an attractive exterior and ravishing interior and add a distinct style statement to your personality. • Small cars are easy to maneuver in rush hours and maintain a strong road grip in difficult road conditions. • Small cars are ideal for small families as they offer enough space and are built around the comfort of driver and passengers. • Small cars are highly fuel-efficient and offer better mileage than the large cars. • Small cars can be bought at highly affordable prices so it offers an opportunity for a large number of people in Pakistan to own a car. • Small cars don’t ask for expensive maintenanceand service checkups. These cars are fitted with efficient drivetrains and mod ern engine technologies so little care will do a world of good in terms of maintenance of these cars. Toyota has recently launched a small car under its Daihatsu subsidiary in Brazil and it can be great if Toyota plans to do the same in Pakistan too. Not only Toyota but other brands too must start thinking of launching their small cars in Pakistan so that an overwhelming influence of “660cc CBU units” imported from Japan can be minimized. Government of Pakistan also needs to be flexible in its approach and should make its policies strict for the import of CBU units in Pakistan so that the regional automotive giants can contribute towards the growth of the small cars industry significantly.

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Monthly AutoMark International

Automotive News - Update

Honda Cars India to export 1.6L diesel engines to Thailand for first time Another first to the carmakers credit will be making the complete 1.6L diesel engine in India as currently it does not have any product that is powered by this specific diesel motor in the local market. The Indian arm of Japanese carmaker, Honda Cars India will for the first time commence exports of the f ully assembled 1.6L diesel engine from its Tapukara plant in Rajasthan. Exports start from July this year. Another first to the carmakers credit will be making the complete 1.6L diesel engine in India as currently it does not have any product that is powered by this specific diesel motor in the local market. This news was confirmed to ETAuto by sources close to the development. The first market the diesel engine will be headed for will be Thailand where Honda has a large manufacturing set up f or desi gn ing , dev elo pi ng and manufacturing vehicle platforms. Thailand is also a large automotive market and hence the need for the higher displacement diesel motor, in an India like market. From Thailand the 1.6L diesel will be exported to other Honda factories in different geographies like Philippines for use in the carmakers global models. In a recent interaction, officials of Honda pointed out that Tapukara in India was the largest manufacturing facility for manual transmissions and diesel engines for the Japanese carmaker. It was also the largest exporter for manual transmissions globally. At present the Tapukara plant has a production capacity of 1.8 lakh engines per annum and makes the 1.2L and 1.5L petrol as well as the 1.5 litre diesel motor

that powers its City, Amaze and Jazz models among others. A visit to the plant showed that the engine assembly rolls out 450 engines daily of all the three varieties. But the assembly line has the capacity to assemble 670 engines daily. This will accommodate the new crop of 1.6L diesels. However, since 2013 when the diesel powertrain division was set up at Tapukara, HCIL has been exporting critical engine parts of the 1.6L diesel to Honda UK for powering the Civic and

CR-V. India and Europe are strong diesel markets for Honda and therefore it decided to make India the manufacturing base for it. Auto component exports form an important business arm of HCIL and in 2016-17, the carmaker exported parts worth Rs 1140 crore to 15 countries, says Jnaneswar Sen, senior VP sales and marketing. Important destinations include North America, South America, Europe, Japan and South East Asia.

year, we were shocked to see Mazda at the bottom of the list, but third place overall and best volume brand is where we’d expect to find the Japanese carmaker.

of cars from A1 to R8, you have to feel some sympathy for Audi dealers. But they’re clearly up for the challenge, as this highlighted by this second place finish. But which brand finishes top?

2. Audi: 806 points

1. Land Rover: 808 points

regularly ranks near the bottom of reliability surveys, but its dealers are clearly very good at keeping the customer satisfied. This is a 35-point improvement from 2016 when it ranked second.

With a bewildering and complex range

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International Automotive Industry - Update

Monthly AutoMark

Tesla eyes Shanghai for its new auto plant Honda adding 2,200 staff to accelerate Chinese SUV output Working weekends will help joint venture's plants meet demand surge Honda Motor will soon begin turning out more sport utility vehicles in China as its sales in the country reach record heights, running key plants on weekends with the help of new staff until another factory can be brought online. Dongfeng Honda Automobile, a 50-50 joint venture of the Japanese automaker and China's Dongfeng Motor, will add a total of 2,200 new workers by July at two plants in Hubei Province making Honda's XR-V and CR-V SUVs alongside models such as Civic sedans. The plants are already operating above their full annual capacity of 510,000 units. Now, they will be able to stay open through the weekend as well. The new staff will ease pressure on the venture's roughly 10,000 current managers and factory workers, many of whom have worked overtime to produce more vehicles than the plants were designed to handle. These new workers will eventually be transferred to a new plant the venture plans to add nearby in the first half of 2019, which will have an annual capacity of 120,000 vehicles.

Hyundai Motor executive says no plan to buy other automakers, will beef up tech cooperation

US electric car manufacturer Tesla Inc will produce vehicles soon in China to seize a bigger share of the world's largest new energy vehicle market. Tesla's production facilities would be located in Shanghai's Lingang Economic Development Zone, and an agreement could be announced as soon as this week, Bloomberg News reported. Representatives of Tesla China were not available for comment on Tuesday. But a source with China (Shanghai) Pilot Free Trade Zone, where Lingang is located, said on condition of anonymity on Tuesday that an announcement is likely to be seen on the Shanghai government website on Thursday. Tesla does not release sales figures by country. But statistics from LMC Automotive Consulting Shanghai show it sold 10,399 cars in China last year, up by 181.7 percent year- on-y ear. Yale Zhang, managing director of

Automotive Foresight, said sales are expected to grow after localization as assembling vehicles in China would allow the company to avoid a 25 percent customs tax. The possible partnership came after China's top planning body voiced its support for international cooperation in electric cars, plug-in hybrids and fuel cell cars. Last week, the National Development a nd Re for m C omm is si o n s ai d automakers are encouraged to make the most of international technologies, capital and human resources to raise the level of China's new energy vehicle sector. To facilitate cooperation, the authorities have even removed the limit on the number of joint ventures international automakers can have in China-two in one segment, as stipulated in the decades-old industry guideline.

From air bag king to bankruptcy court: A Q&A on Takata's fall Global recalls leave 84-year-old company with some $9bn in debt Japanese air bag maker Takata is expected to file for bankruptcy protection, possibly within this month, following massive global recalls of products linked to deadly accidents. The company will leave behind more than 1 trillion yen ($9.02 billion) in debt, making it the largest bankruptcy in the nation's postwar history. Here is what y o u ne ed t o k no w a bo ut t he manufacturer's rise and fall. Q: How did Takata rack up so much debt? A: Takata's air bags are widely used. Following the discovery of defective inflators, the company was forced to recall some 100 million units around the world. This process is expected to cost about 1.3 trillion yen -- more than enough to break the back of the 84-yearold manufacturer.

Q: How did Takata get into the air bag business in the first place? A: It started out as a textile company and began producing seat belts for carmakers in the 1960s. It launched air bag production in Japan in 1987, and its sales grew as the components became standard in vehicles worldwide. Q: But how did its air bags become so ubiquitous? A: Takata developed air bags with Honda Motor, its biggest client. It expanded overseas alongside the Japanese automaker in the 1980s. Today, Takata rings up nearly 80% of its sales abroad. Q: How did the defects come to light? A: The defects attracted the public eye after two people died in the U.S. due to exploding air bags in Honda Accords. The U.S. Congress eventually took charge of the issue, as lawmakers grew frustrated with Takata's slow reaction.

Hyundai Motor Co (005380.KS) Vice Chairman Chung Eui-sun said on Tuesday the South Korean firm has no plan to buy other automakers, although it will beef up cooperation with other technology firms. His comments were made at the launch WABCO Signs Strategic Cooperation Framework Agreement of the Kona, a small sport utility vehicle. with FAW Jiefang Automotive Company, a Leading Commercial The automaker aims to sell over Vehicle Manufacturer in China 200,000 Kona models in South Korea WABCO and FAW Jiefang will team up to enhance the safety and efficiency of and overseas next year as it tries to revive commercial vehicles and fleet operators in China by advancing braking systems, flagging sales and catch up with rivals chassis components, and other technologies. Building on its more than 20-year in the SUV segment. supply relationship with FAW Jiefang.

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Car / Light Vehicle Price List SUZUKI Ex Factory Price

Model Model

WAGON-R VXR 1000cc Euro II WAGON-R VXL 1000cc Euro II MEHRAN VX 800cc Euro II MEHRAN VX 800cc CNG MEHRAN VXR 800cc SUZUKI SWIFT 1.3L DLX SUZUKI SWIFT 1.3L Automatic NEW CULTUS VXR NEW CULTUS VXL BOLAN VX EURO II BOLAN CARGO RAVI PICK-UP STD 800cc E2

Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.

1029,000 1069,000 650,000 720,000 773,000 1,327,000 1,463,000 1,250,000 1,391,000 725,000 696,000 667,000

Rs. Rs. Rs. Rs.

1,839,000 1,699,000 2,142,000 2,418,000

Advance Tax

Rs. Rs. Rs. Rs. Rs. Rs. Rs.

25,000 25,000 10,000 10,000 10,000 50,000 50,000

Rs. 10,000 Rs. 10,000 Rs. 10,000

SUZUKI IMPORTED VEHICLES SUZUKI CIAZ (A/M) 1400cc SUZUKI CIAZ (M/T) 1400cc JIMMY 1328cc JLSX MT APV 1.5L GLX MT (Petrol)

TOYOTA COROLLA Model XLI VVT-i 1.3L M/T GLI VVT-i 1.3L M/T GLI VVT-i 1.3 A/T ALTIS 1.6L Dual VVT-i A/T ALTIS 1.8L Dual VVT-i A/T Corolla Altis A/T CVT-I (1.8 ltr) GRANDE 1.8L S.R. M/T GRANDE 1.8L S.R. A/T FORTUNER 2.7L A/T Petrol

HONDA Honda BR-V (i-VTEC) 1.5 Rs. 2,241,000 Honda BR-V (i-VTEC S) 1.5 Rs. 2,341,000 Model Price Honda Civic 10th Generation 1.8L Oriel Rs. 25,41,000/=* Honda Civic 10th Generation 1.5L Turbo Rs. 29,11,000/=* Honda Aspire Manual 1.3L Rs. 1,663,000 Honda Aspire Manual 1.5LHYUNDAI Rs. 1,683,000 Honda City 1.3L Manual Rs. 1,553,000 Honda City 1.3L Automatic Rs. 1,674,000 Honda Civic VTI Manual 1800cc Rs. 2,053,000 Honda Civic VTI Manual SR (Oriel) Rs. 2,285,000 Honda Civic VTI Prosmatec 1800cc Rs. 2,174,000 Honda Civic VTI Prosmatec SR (Oriel) Rs. 2,406,000 * Ex-Factory prices, Advance income tax, freight & insurance will be added as per destination Price will be charge at the time of deliver what-so-ever

DFSK PRINCE PAKISTAN Model

Price

K01 997CC, 2300mm, A/C PS K01 997CC, 2700mm K07 997CC, 7 Seater, AC/PS C37 1500CC, 11 Seater, AC/PS

Rs. 779,000 Rs. 779,000 Rs. 9,80,000 Rs.1,550,000

Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.

Price 1,672,500 1,817,500 1,892,500 2,047,500 2,147,500 2,272,500 2,307,500 2,457,500 5,085,500

Toyota Hilux Pickup 4x2 sc Model

Price

Brand New Toyota Hilux Pickup, 4x2, 2500cc Single Cabin, White only, Hilux STD

Rs. 2,063,000

Toyota Hilux Pickup 4x4 E Model

Price

Toyota HILUX 2494cc, Diesel Turbo Charger Common Rail Engine, 4x4 Double Cabin - Standard Model

TOYOTA VIGO DAIHATSU Model Model

Price Price

Rs. 3,324,500

FAW MOTORS Price

Model

Vigo Champ-V MT Rs. 3,598,500 FAW Carrier 1000cc (WHITE ,BLACK,STRONG BLUE & SILVER) FAW X-PV 1000cc Std FAW X-PV 1000cc A/c Vigo Champ-G AT Rs. 3,798,500 FAW Sirius S80 (WHITE ,BLACK,STRONG BLUE & SILVER) Grand 1500cc EFI Pet FAW V2 1300cc A/C EFI Petrol CBU

Monthly AutoMark Magazine - International

Rs. 749,000 Rs. 849,000 Rs. 899,000 Rs. 1885,000 Rs. 1069,000

Price updated June- 2017

International Automotive Industry - Update

Monthly AutoMark

In crisis mode, Honda risks losing its originality Hyundai plays catch-up with new subcompact SUV Hyundai Motor has only four SUV lineups, including Creta, a subcompact SUV targeting emerging markets. Tucson and Santa Fe cater to buyers seeking medium and large SUVs. The company plans to expand its SUV models by 2020 by adding mini SUV and executive vehicles, among others. Hyundai Motor Co is playing catch-up in the fast-growing sport utility vehicle market with its first subcompact SUV targeting Europe and North America. The South Korean automaker said Tuesday that the Kona will go on sale this month in South Korea before it launches in Europe and North America. Hyundai Motor has long focused on the Sonata and other sedans, which helped build it a reputation in the West as a maker of cars that are excellent value. But in recent years, most growth in global auto markets, especially in China, has come from SUVs. Hyundai's deteriorating profitability and missing of its annual sales targets in recent years were attributed to its failure to respond to rising global demand for SUVs. Hyundai arrived late but now plans to increase its bet on SUVs. With the launch of the Kona, Hyundai is seeking a slice of the subcompact SUV market - the fastest-growing sector in the auto market. The sector snowballed by nearly 10 times from 2010 to 2016, Hyundai said, citing data from IHS Automotive. This year, the segment's annual growth rate is expected to be 19 percent.

Suzuki Celerio Still Australia’s Cheapest New Car to own The Suzuki Celerio was declared the cheapest micro car to buy and own, and the only model to go close to dipping below the $100 per week barrier at $100.78 per week. By virtue of being the country’s cheapest micro car, the Celerio also wears the crown as ‘Australia’s cheapest new car’.

Takaki Nakanishi, the CEO of and an analyst at automobile-focused Nakanishi Research Institute, said Honda has been inefficient in certain areas, like developing region-specific models. But, he added, "this has brought originality to Honda." With automotive technologies rapidly advancing, Nakanishi said, the company must have concluded that it needs to make a change. In this sense, it is following in the footsteps of Toyota Motor, which had to move away from a management policy that stressed ever-expanding sales. This policy had been in place until sometime before U.S. investment bank Lehman Brothers collapsed in 2008. With the Lehman shock sending the global economy into a tailspin, Toyota President Akio Toyoda called for p rod u cin g hi gher- qual it y car s. But the automaker has since made another turn, toward making cars "wisely," in which it is placing a focus on selling safe yet cheap small cars. What now concerns investors is that management efficiency might trample Honda's originality. "The major challenge," Nakanishi said,

"is how much efficiency Honda can wring out of its operations without losing its originality." Yoshiyuki Matsumoto, president of Honda's research and development unit, voiced a sense of crisis, saying, "If we cannot make creative products, there would be no value to Honda's existence." No clear earnings target When Honda June 8 pledged to enhance management efficiency, it did not provide specific mid- to long-term earnings and financial goals. It did, however, present a reference target of achieving a return on equity of 8% and an operating margin of 7%, albeit without disclosing the exchange rate forecast it based these figures on. But there are some voices urging the company to present numerical targets and maintain management discipline toward achieving them. They said doing so could help the company show how it intends to balance efficiency and originality. Sony could be a guide here. The Japanese corporate icon was able to revive its brand by going through a reorganization in which responsibilities and authority were clearly defined.

Suzuki Announces FY2016 Vehicle Recycling Results in Japan Suzuki Motor Corporation has today announced the results of vehicle recycling for FY2016 (April 2016 to March 2017) in Japan, based on the Japan Automobile Recycling Law*1. In line with the legal mandate, Suzuki is responsible for promoting appropriate treatment and recycling of automobile shredder residue (ASR), airbags, and fluorocarbons through recycling fee deposited from customers. Recycling of these materials are appropriately, smoothly, and efficiently conducted by consigning the treatment to Japan Auto Recycling Partnership as for airbags and fluorocarbons, and to Automobile Shredder Residue Recycling Promotion Team*2 as for ASR. The total cost of recycling these materials was 2,774.2 million yen. Recycling fees and income generated from the vehicle-recycling fund totalled 3,246.73 million yen, contributing to a

net surplus of 472.53 million yen. For the mid-and long-term, Suzu ki continues to make effort in stabilizing the total recycling costs. The results of collection and recycling of the materials are as follows. 1. ASR • - 50,600.3 tons of ASR were collected from 392,998 units of end-of-life vehicles • - Recycling rate was 97.7%, exceeding the legal target rate of 70% set in FY2015 since FY2008 2. Airbags • - 951,445 units of airbags were collected from 234,442 units of end-oflife vehicles • - Recycling rate was 93.5%, exceeding the legal target rate of 85% 3. Fluoro carbons • - 83,816.7kg of fluorocarbons were collected from 345,239 units of end-oflife vehicles

www.automark.pk | July-2017 | Page 45

Generated by Foxit PDF Creator ÂŠ Foxit Software http://www.foxitsoftware.com For evaluation only.

Exclusive review by Taha Bin Mujahid

THE JOURNEY OF CULTUS

Suzuki Cultus a car known for its Executive looks was launched in Pakistan in 2000 by Pak Suzuki with 3 Cylinder 1000cc Carbureted Engine and 5 Gear Manual Transmission. The Car was very basic in its outlook and was launched with the three variant that was VX, VXR& VXL. Due to its sleek hatchback shape and economical price it became the Apple of the eye, or you can say it was the only hatchback at that time which had good space from inside while maintaining its sleek exterior. The Interior was luxury according to its price tag. The drive was comfortable. The rear Suspension was Independent which provides the smooth drive even on bumpy roads. In 2001 the Production of Factory Fitted CNG started so it became convenient to the buyers.. The VX variant of the Cultus had black bumpers with no air-conditioning while the VXR was equipped with Body matched color bumpers and with airconditioning. The VXL Variant of the Cultus was Fully loaded that in addition to the VXR. The features that includes in VXL werePOWER STEERING, POWER WIND OWS and BOD Y MATCHED SIDE MIRRORS.

In 2005, Pak Suzuki discontinued the VX variant while the VXR & VXL remain produced. Although the vehicle had not any Safety feature like SRS Air Bags or ABS but still it was ruling the market very well. During the whole time period Cultus received some minor Cosmetic Changes that includes ALLOY RIMS, DOOR MOULDINGS, FRONT & REAR BUMPERS and HEAD & TAIL LIGHTS. The Interior Includes, the color changes in AC GRILLS, DASHBOARD F RO NT P ANEL C OVER and a SPEEDOMETER. In 2007, Pak Suzuki brought a major change in the heart of Cultus and that was the EFI ENGINE. The Old 3

Cylinders Carbureted engine was replaced with New 4 Cylinders EFI(Electronic Fuel Injection) Engine while the Transmission remains same. The EFI engine provides the better fuel average than the Carbureted engine because the everything in EFI Engine works on the basis of Sensors & Actuators which controlled by ECU (Electronic Control Unit) while improving power and torque delivery as well.The available variants were now called as VXRi and VXLi. In 2010, Pak Suzuki Launched Suzuki Swift, but their own Cultus VXLi became the competitor to the new Swift so they had to discontinued the production of VXLi to boost up the Sales of newly launched Swift. In 2012, Pak Suzuki introduced Euro II technology. It is used to prevent harmful emissions from the vehicle and make the environment friendly. Vehicles with EURO Technology also known as Green Vehicles. In 2016, Pak Suzuki rolled out with the Limited Edition of Cultus. The Shape was same but still some cosmetic changes were made that included new door trims & fabric, 2-DIN sound system, matching door mirrors and alloy

www.automark.pk | July-2017 | Page 46

Monthly AutoMark International

Automotive News - Update

rims. The price of the final edition Cultus went up to PKR 11.24 lac for the EuroII and PKR 11.99 for the Euro-II CNG variant. This Limited Edition of Cultus remains Continued for about 1 year. In Feb 2017, Pak Suzuki representatives mentioned i n a p re ss re le ase ab ou t t h e discontinuation of bookings of Cultus. The Journey of 17 years of Cultus was about to end, and revived in a new mode altogather. After the discontinuation of Cultus, pictures of New Cultus already leaked and were roaming around the Internet. It became the hot topic for all Au tomot ive Sites/Bloggers and Automotive Enthusiast. Many of them Praise the Car because they did not expect such type of modernized Car from SUZUKI. In April 2017, Pak Suzuki officially launched the NEW CULTUSwith its new Dynamic and Sleek hatchback Shape and with wide luxurious interior.Internationally this car is known as Suzuki Celerio and in Pakistan people also expected the same name but it was launched with the name of CULTUS. The car has new 1000cc, 3 cylinder Kseries EFI Engine and 5 gear manual Transmission front wheel drive. The shape was totally different from its old model. The car is also equipped with Key-less entry & Immobilizer (AntiTheft Security System). Inthis ignition

key is encoded for exclusive use with the immobilizer only; therefore, it is impossible to start the engine without the original encoded ignition key. The New Cultus is also equipped with Electronic Power Steering System, Power Windows, Powered Mirrors which can be adjust from driving side, Fog lamps, Chromed front grill, Alloy Rims, ABS (Anti-lock braking system) and best feature regarding Safety is SRS Dual Airbags, one for driver and other for the front passenger, while this the only locally manufactured car by Pak Suzuki which is equipped with Airbags. Although this car has not came with factory fitted CNG. The new Cultus is currently available in 7 colors i.e Pearl Red, Graphite Gray, White, Super Pearl Black, Cerulean Blue, Silky Silver & Sand Beige.This New Cultus came up with two variants that is VXR & VXL.

Difference between CULTUS VXR & VXL

• Cultus VXR is a base model that is very simple. VXL comes with Stylish Fog lamps while VXR does not have. • VXL is equipped with Power Mirrors, while VXR is equipped with simple Mirrors. • VXL has body color matched side mirrors and VXR has Black color side mirrors.

• Cultus VXL has Alloy Rims while VXR has Steel Rims with Wheels Caps. • Presence of Dual Air-Bags is the most important difference between both variants. Suzuki Cultus VXL comes with latest safety feature of SRS Dual Air Bag system but VXR does not have this feature. Dual Air-Bags means it has air bags not only for driver but also for passenger on front seat. • Last and the most important difference between both variants of New Suzuki Cultus 2017 is the price. The basic variant of Cultus VXR comes in 1,250,000 PKR while New Cultus VXL which is fully powered variant comes in 1,391,000 PKR. Hence the difference between VXR and VXL is about 1,41,000 rupees. All the Authorized Dealers have started to provide free Test Drive of this New Cultus from23rd of April. On the same day the test drives started, many People Exchanged their old Suzuki Vehicle with the new Suzuki Cultus with Suzuki Exchange Program. Overall New Suzuki Cultus 2017 is perfect hatchback car that is added into the collection Pak Suzuki. Now everybody is waiting for the New Model of Suzuki Mehran and there is hope that it won’t be with just Cosmetic Changes!.

• VXL has power windows while VXR comes with manual handle through which you have to pull the mirror up or down with your own hand. • VXL has modern ABS (Anti-Lock Braking System) which provides better grip while braking and prevent the vehicle to skit. And on the other hand VXR is has not ABS sytem.

www.automark.pk | July-2017 | Page 47

Monthly AutoMark International

Article by Mr. Zahid Malik

Comparisons Unlimited 125cc & 150cc Bike Categories Unlimited comparison because we don’t have One-on-One brand products. In Pakistan we have made a blend of comparison. In 125cc we have Honda CG125, Deluxe 125 and in comparison we have Yamaha YBR125 / YBR-G / YB125Z. Piaggio Storm is not seen in market, but an alike product RP Twister is there now. Honda CG125 is top selling brand in 125cc category but it is a lot different from Yamaha’s hot product YBR125. On the other hand we see many discussions online where riders are comparing Honda CG125, Suzuki GS150 and Yamaha YBR125. Technically speaking all three are different and cannot stand face to face for comparison. One of these, is a 150cc and other has old design of 80s along with low/old level of comfort braking system etc, whereas YBR125 has good suspension and disc brake, but it a is 125cc machine. Considering all above, Pakistan Bikers Club still tried to make a decent comparison so that one could know facts and have some help in making a fair decision. Let’s first categorize the bikes. The famous 125cc bikes in the category are Honda, CG125, Deluxe 125, (CG Dream but not very known) Yamaha YBR125, YBR-G, YB125Z. The third bigger Japanese brand Suzuki does not show (in Sheet no:PBC-01/17-5) Comparing this category with respect to weight in given table, you can see that CG125 & CG Dream have lowest weight and second is YB125Z. As power to weight ratio is an important factor so you can understand that the bike which has to carry lightest body will have advantage and will be easily going for acceleration (speed change). (in Sheet no:PBC-03/19-5) Another important point that can help riders technically for better enjoyment in motorcycling, better road grip etc is size of the bike. Bigger the size, the more road grip, more comfort, better handling. In 125cc Honda Deluxe 125 is number one due to it’size. Infact, it is

almost in One-on-One comparison with 150cc category. Then in 150cc category Honda CB 150F is the winner in size, which means more road grip, more comfort, better handling. So, for people who ride a lot, specially for tours the bike with bigger size can be better option. Ground Clearance is important factor for tourists who come across areas with broken roads or stones on the tracks. In local travel a difference of few MMs may not be important, but for tours it can do a lot of help. In 125cc category Yamaha YB125Z has maximum ground clearance of 150mm. Whereas, Derbi 150 or it’s copy Road Prince WEGO wins in 150cc category with ground clearance of 180mm. If a company makes a product and is sure that it will last for one year. Then the company is in a position that it can easily seal & stamp for warranty of product quality for around 9-10 months. Proceeding with this important line about warranty of product, we just want to share information and request you to get idea of quality & standards. Warranty of Honda bike’s engine is 20,000kms or 3 years, whereas for Yamaha it’s 12000kms or 1 year and for Suzuki bikes it’s 6000kms or 6 months. So you can see that Honda (3) and Yamaha’s (1) warranty period is in years, on the other hand for Suzuki it’s in months (6). It’s half of Yamaha and then Honda is offering three times more than Yamaha. In short, there is hell of difference if we consider to compare Honda & Suzuki’s warranty periods. In the main Comparison sheet we have tried to compare under many heads, do read and know many unknown facts. Some of the information is not available because we could not find strong proves for these and we did not want to rely on words of mouth. Along with these tables, we want to make comparison on General but very important sections and hope it will help you a lot. Resale: So far, Honda is the only

brand that has been able to make it’s good resale. CB150-F is their new product and will need time to have good resale. Right now, we consider it like Yamaha and Suzuki in terms of resale value. Services & Spares Availability: A friend who had a bike tour with title G2G (Gawadar to Gilgit) with a Suzuki 150 told us that he has seen outlets offering services and genuine spare parts almost throughout Pakistan. Infact Atlas Honda Ltd considers this as heaviest edge over others. Design: In 125cc category the Yamaha’s YBR series is considered to be a latest product. Whereas in 150cc category and locally manufactured bikes the CB150 F from Honda has been a very good addition. In design it is far superior than it’s local competitor (Suzuki GS150). Brand Name: We have three Japanese brands manufacturing bikes in Pakistan with many other local brands like United, Super Power, Road Prince etc. But as a whole, Honda has built an image of a strong brand in Pakistan. Whereas in local group United has turned up as a strong brand and is rated as Secon d lar gest t wo whe els manufacturer in Pakistan. Customer Care: If we consider data of riders from all over Pakistan, we must share that no company can be known for best quality Customer Care in Pakistan. We would also like to share that one can find online that there have been cases filed in consumer courts against Pak Suzuki. Dear readers and riders, instead of riding bike @ high speeds and give reviews in no time we planned a proper comparison system. So that riders could know everything in detail and then make most of the comparison themselves. This article is the first step and we hope that it has been of some help atleast. Disclaimer: If you find that there is some mistake in data of tables given, please share with us (with proof) to edit. Article by: Mr. Zahid Malik, Founder & Head Safe Riding – Road Safety Dept. Pakistan Bikers Club

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www.automark.pk | July-2017 | Page 49

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MADE IN PAKISTAN MOTORCYCLES RETAIL PRICE LIST

70cc Motorcycle Sr./ Product & Model Name No. 1. Honda CD-70 2. Honda CD Dream 3. United US 70 4. United Extreme 70 5. Road Prince Bullet 6. Road Prince 70cc 7. Unique UD-70 8. Super Power SP-70 9. Super Power Delux 10. Super Star SS-70 11. Hi-Speed SR-70 12. Ravi Premium R1

Retail Price Rs. 63,500/= Rs. 67,500/= Rs. 43,500/= Rs 44,500/= Rs. 45,500/= Rs. 41,000/= Rs. 44,500/= Rs. 44,700/= Rs. 48,200/= Rs. 44,000/= Rs. 44,000/= Rs. 46,950/=

125/150 cc Motorcycle No.

Brand & Model Name

Retail Price

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21.

Honda CG-125 STD Honda CG-125 DX Honda CD-125 Dream Honda CB-150F United US-125 Euro 2 Road Prince 125cc RP Twister 125cc RP WEGO 150cc Super Power Archi 150cc Unique UD 125cc Unique UD 150cc Super Star SS-125 Super Star SS-125 DLX Hi-Speed SR-125cc Metro MR-125 Regular Ravi Piaggio Storm 125 Yamaha YBR-125Z Yamaha YBR-125G Yamaha YBR-125 Crown CR-125 Zxmco ZX-125-Euro II

Rs. 105,500/= Rs. 125,000/= Rs. 106,500/= Rs. 159,000/= Rs. 70,000/= Rs. 67,000/= Rs. 108,000/= Rs. 180,000/= Rs. 180,000/= Rs. 70,000/= Rs. 165,000/= Rs. 68,800/= Rs. 67,000/= Rs. 75,000/= Rs. 67,000/= Rs. 108,000/= Rs. 115,900/= Rs. 133,900/= Rs. 129,900/= Rs. 65,000/= Rs. 71,600/=

Sr./ No. 13. 14. 15. 16. 17. 18. 19.

Product & Model Name Ravi Hamsafar-70 Bionic AS-70 Crown CR-70 Metro Premier+ 70cc Ms Jaguar MS 70 Euro- II Ms Jaguar MS 70

( DREAM)

Zxmco ZX-70 Regular

Retail Price Rs. 43,500/= Rs. 44,500/= Rs. 42,000/= Rs. 45,600/= Rs. 41,800/= Rs. 43,800/= Rs. 42,300/=

100cc/110cc Motorcycle No. 1. 2. 3. 4. 5. 6. 7. 8. 9.

Brand &Model Name Honda Pridor United US-100 Euro 2 Road Prince 110cc Unique UD-100 Super Power SP-100 Super Star SS-100 Crown CR-100 MS JAGUAR MS 100 Zxmco ZX-100-SS

Retail Price Rs. 86,000/= Rs. 50,000/= Rs. 48,500/= Rs. 73,000/= Rs. 60,000/= Rs. 57,000/= Rs. 52,000/= Rs. 48,800/= Rs. 51,600/=

Suzuki Motorcycle Sr./ Product & Model Name No. 1. SD110 Sprinter ECO 2. SD110 Raider 3. GS-150 SE Euro-II 4. GD 110 Euro-II 5. GD 110s Euro-II

Retail Price Rs. 98,400/= Rs. 101,400/= Rs. 158,500/= Rs. 119,000/= Rs. 131,000/=

Heavy Bikes Sr./ Product & Retail Price No. Model Name 1. Inazuma GW 250 Rs. 725,000/= 2. Intruder M800 Rs. 1,700,000/= 3. Hayasuba GSX1300R Rs. 2,600,000/= 4. Zxmco ZX-200cc Rs. 2,45,000/= Bandit GSF650SA 5. Rs. 1,550,000/= 6. Super Power SP 200cc Rs. 1,75,000/=

www.automark.pk | July-2017 | Page 51

Price update: July-2017

Monthly AutoMark International

Automotive News - Update

Swedish auto giant Scania to sell heavy vehicles in Pakistan

Scania Executive Vice President Sales and Marketing Christian Levin and Yousaf Dewan Companies Chairman Dewan Muhammad Yousuf Farooqui inked the distribution agreement recently in the presence of top officials of both companies and renowned customers of heavy commercial vehicles. Encouraged by a huge investment potential in Pakistan’s rapidly growing automobile market, renowned Swedish heavy commercial vehicle manufacturer Scania has announced that it will introduce its premium trucks, trucktractors, buses and coaches in the South Asian count ry through a local distributor. Later, the company will explore the potential of setting up a manufacturing plant in Pakistan. The European manufacturer has signed an agreement with Yousaf Dewan Companies and awarded distribution rights for introducing its products in Pakistan market. Scania Executive Vice President Sales and Market ing Christian Levin an d Yousaf Dewan Comp anies Chairman Dewan Muhammad Yousuf Farooqui inked the distribution agreement recently in the presence of top officials of both companies and ren own ed cust ome rs o f heav y commercial vehicles. “We are delighted to introduce our quality trucks and buses in Pakistan,” said Levin. “Pakistan is quickly emerging as a preferred investment destination in the world; the automotive industry, in particular, sees a lot of investment

potential in the wake of China-Pakistan Economic Corridor (CPEC).” Levin elaborated that the vision behind introducing Scania products was to explore the full potential of Pakistan market by raising the bar higher for competition. The Swedish company’s entry into Pakistan would not only strengthen its business, but would also go on to support the country’s growth and progress on the socio-economic front by creating multifarious employment and business opportunities. “We are committed to expanding our investment and will explore the prospects of manufacturing our products here in Pakistan,” he revealed. Scania is a major Swedish manufacturer of commercial vehicles, specifically heavy trucks and buses. The company was founded in 1891 in the Swedish province of Skane and its head office has been in Sodertalje since 1912. Today, with 125 years of rich experience in the global automobile industry, Scania has operations in 100 countries around the world and employs approximately 42,100 people. “I believe it is opportune time for Scania to enter Pakistan market as our economy

is growing by leaps and bounds, especially the truck and bus sector is witnessing unprecedented exponential growt h, ” commented Farooqu i, Chairman of Yousaf Dewan Companies. He insisted that stable policies of the government were playing a major role in the revival of automotive industry in Pakistan. As a result, the truck and bus market is currently experiencing unprecedented robust growth – a barometer for deep-rooted economic expansion. Furthermore, CPEC was bringing an investment of $57 billion in energy and infrastructure projects and was creating a shift in the demand for high-speed, high-power, fuel-efficient, long-haulage solutions, Farooqui added. Yousaf Dewan Companies has been providing automobile solutions for close to two decades now. It is already associated with renowned brands like BMW and Mitsubishi. It has also assembled Hyundai and Kia completely knocked down (CKD)-based products in the past. Now, it intends to cater to the needs of heavy commercial vehicle customers by joining hands with Scania.

www.automark.pk | July-2017 | Page 52

Business Seminar - Event Update

Monthly AutoMark International

Corporate News - Glimpses

CM Punjab visited DFSK & Road Prince stall along with LCCI President. CEO Mr. Tanveer Ahmad is giving briefing about DFSK Products

Minister of Mine & Minerals Punjab Mr. Sher Ali visited UNITED Stall at ISBOP Expo 2017 on last month in Lahore

Unique Motorcycles Karachi Dealers Iftar at Carnation Banquet www.automark.pk | July-2017 | Page 53

Monthly AutoMark International

by Zohaib Velani