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HISTORY of AUTOMOBILE INDUSTRY in PAKISTAN The Pakistan Automobile Industry Is A Crucial Part of Our Growing Economy

The automobile industry in Pakistan began in the 1950s with the establishment of several assembly plants by international manufacturers partnering with local businesses. The industry grew over the decades but saw challenges including periods of nationalization. It has since been privatized and the number of vehicles produced, including cars, motorcycles and commercial vehicles, has increased substantially. Currently there are four major automakers operating in Pakistan, with the industry contributing significantly to the national economy and remaining an area of growth potential.

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Khizar Farooq
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731 views4 pages

HISTORY of AUTOMOBILE INDUSTRY in PAKISTAN The Pakistan Automobile Industry Is A Crucial Part of Our Growing Economy

The automobile industry in Pakistan began in the 1950s with the establishment of several assembly plants by international manufacturers partnering with local businesses. The industry grew over the decades but saw challenges including periods of nationalization. It has since been privatized and the number of vehicles produced, including cars, motorcycles and commercial vehicles, has increased substantially. Currently there are four major automakers operating in Pakistan, with the industry contributing significantly to the national economy and remaining an area of growth potential.

Uploaded by

Khizar Farooq
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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HISTORY OF AUTOMOBILE INDUSTRY IN PAKISTAN The Pakistan

automobile industry is a crucial part of our growing economy. It


has gone through different phases 1950s (Private sector).1960s
(Private sector). 1970s (Nationalization).1980s and onwards
(Privatization & entry of private sector). The industry started in
Pakistan when the first automobile plant was set up in May 1949
by General Motor & Sales Co., it was set up on an experimental
basis, and however, it grew into an assembly plant for Bedford
Truck and Vauxhall cars. Seeing such progress, three major auto
manufacturers from the U.S collaborated with Pakistani business
men to set up; Ali Automobiles to manufacturer Ford Products in
1955, Haroon Industries to assemble Chrysler Dodge cars in 1956,
Khandawalla industries to assemble American Motor Products in
1962, and Mark Trucks Plant in 1963. However, the absence of
technological knowledge, the basic professionalism, led to demise
of these organizations. Our industry operates under franchise and
technical cooperation agreement with Japan, Europe, Korea and
China. The auto industry in Pakistan is fast evolving as a robust
industry. Some sub-sectors of this fast growing industry, like
motorcycle production, have already achieved economies of
scale. The level of motorization has also been gradually rising
over the years. In 1998-99, it was three cars per 1000 persons,
which has significantly increased to 11 cars per 1000 persons in
2005-06. The indigenous production of motorcycles increased by
25 per cent during 2005-06, reaching to an all-time high of
520,124 as compared to 106,797 units in 1996-97, which
accounts for around 380 per cent increase in motorcycle
production during the last nine years. The production of trucks as
well as that of buses has also posted sufficient increase during the
last 10 years. Some 2,994 units of trucks were being produced in
the country in 1995-96 which, over the years, have increased to
4,518 units, showing a rise of 51 per cent. In the case of buses,
the rise in production is more pronounced as compared to that of
trucks as their production augmented by around 74 per cent
during the last decade or so. Investment in the automobile
industry in Pakistan started in the mid-50 when Kandawalla
Industries established its units for assembling buses and trucks,
the company's name was later changed to NayaDaur Motors.
National Motors took the indigenization when it came out in the
60's and was said to have reached above 80% deletion of the
Bedford lorries and trucks before it closed down. Towards the end
of the seventies, all automobile assembly in Pakistan stopped,
until 1983 when PAK SUZUKI started manufacturing their vehicles
in Pakistan. Further Toyota Indus Motors was setup, followed by
Honda. Today we have four major automobile manufacturing
industries, these include, Toyota Indus Motors, Pakistan Suzuki,
Honda Atlas and Diwan Farooq Ltd.
950s[edit]
Pakistan produced its first vehicle in 1953 at the National Motors
plant in Karachi, according to the Ministry of Industries &
Production. The plant was opened in conjunction with General
Motors who arranged the facilities for the production of Vauxhall
cars and Bedford trucks. Subsequently, buses, light trucks and
cars would be assembled at the same plant. In the same year,
Ford trucks partnered with Ali Automobiles where they introduced
Ford Anglia, Ford pickups and the Ford Kombi. Exide Pakistan also
began production of car batteries in 1953. Haroon Industries
partnered with Dodge Motors in 1956.[11]

1960s[edit]
In 1961, Allwin Engineering introduced precision auto parts to the
Pakistani auto market. In 1962, Lambretta partnered with Wazir
Ali Engineering to begin production of the Lambretta TV200
scooter while Kandawala Industries introduced Jeep CJ 5, CJ 6, CJ
7. In 1963, General Tyre Pakistan began production in Karachi
while Hye Sons began production of Mack Trucks. In 1964, Rana
Tractors began producing Massey Ferguson Tractors while the
famous Vespa scooter and rickshaw were introduced by Raja Auto
Cars. In 1965, Jaffer Industries and Mannoo Motors began
operations.
1970s[edit]
The 1970s saw nationalization of many companies. In 1972, the
Pakistan Automobile Corporation or PACO was formed. Many
companies were bought out or merged into others. Wazir Ali
Engineering was renamed to Sindh Engineering, Ali Autos to
Awami Autos, Haroon Industries to Republic Motors, Ghandara
Motors to National Motors, Hye Sons to Mack Trucks, Kandawala
Industries to Naya Daur Motors, Jaffer Industries to Trailer
Development Corporation and Rana Tractor to Millat Tractor.
Dawood Yamaha introduced Yamaha motorcycles in 1974 and in
the same year Beta Engineering started producing diesel engines.
In 1976 Suzuki Motor Cycle launched by Sindh Engineering. Saif
Nadeem Kawasaki launched Kawasaki motorcycles in 1977 while
Suzuki Jeep was manufactured by Naya Daur Motors.

1980s[edit]
In 1980, Awami Motors began manufactured Suzuki pickups while
Sindh Engineering began producing Mazda Trucks. In 1981,
Agriauto Industries introduced production of local auto parts while
in 1982, Suzuki began production of vehicles. In 1983, the Vendor
Development & Technical Cell or VDTC was formed along with Al-
Ghazi Tractors which was introduced by Fiat. In 1986, Hinopak
Motors began as a joint venture between PACO, Al-Futtaim, Hino
Motors & TTC. In 1987, Ghandara Nissan began production of
Nissan Diesel Trucks. In 1989, Pakistan Association of Auto Parts &
Accessories Manufacturers began operation.

1990s[edit]
The industry was highly regulated until the early 1990s. Following
deregulation, the decade witnessed a huge boom in auto
production, as nationalization was abandoned in favor of
privatization. Japan acquired the 40% shares of Pak Suzuki in
1991. In 1993, the Indus Motor Company began production of
Toyota Corollas. In 1994, the Pakistan Automotive Manufacturer
Association formed, and Honda Atlas introduced manufacturing of
the Honda Civic. In 1995, the Engineering Development Board
inaugurated the PAP show.

2000s[edit]
From 2000 to 2007, auto sales reached record sales year after
year, reaching a peak of 195,688 sales in 2007, thanks to rising
car financing up to 70-80% by banks and low interest rates
coupled with rising rural purchases. From 2007 to 2009, the auto
sector witnessed reduce sales amid high interest rates and Yen
appreciation against the Rupee. In 2007, the automotive industry
made up 2.8% of Pakistan's GDP and contributed 16% to the
manufacturing sector. The 2000s also saw the introduction of dual
fuel options to run both on Petrol and CNG, which is more
affordable and cheaper than petrol in the country.

2010-present[edit]
In 2010, auto sales rebounded and began increasing again. The
auto industry predicted a growing demand in Pakistan and
invested over Rs20 billion during this decade. Motorcycle
production hit a record level of over 1.5 million units in 2010-
2011. In 2015, the Auto Policy 2016-21 was introduced, to help
introduce new entrants into the Pakistan auto industry, which has
traditionally been dominated by Honda, Toyota and Suzuki. The
auto industry remains the second largest payer of indirect taxes
after the petroleum industry in Pakistan. At present, there are 10
cars for every 1000 people in Pakistan. This is one of the lowest
ratios among emerging economies, which itself speaks of high
potential of growth. Rising per capita income with changing
demographic distribution and an anticipated influx of 30 to 40
million young people in the economically active workforce in the
next decade will provide a stimulus to the industry to expand and
grow [12]

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