Auto firms up in arms over govt policies

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Automobile Original Equipment Manufacturers (OEMs) have sought long-term and consistent policies in the upcoming budget in order to devise a market and investment strategy in the challenging business environment of the country, representatives of the industry have insisted. Market players in the automobile and its subsidiaries have asked the government to chalk out a development plan for local engineering sector with strong commitment towards implementation enabling them to devise production and expansion plans after taking foreign and local investors on board.
They insisted the government should devise a balanced policy protecting local manufacturers and giving tax and investment incentives to new entrants instead of deviating from AIDP so that a level playing field is ensured, an official of the local automotive manufacturer said. The confidence of foreign investors has been badly shaken when the government took upturned its policy agreed in Auto Industry Development Plan (AIDP) and relaxed the age of imported cars up to five years, he noted.
He also pointed out that the abrupt changes in policy have hurt the growth of local automakers in the local markets, which also hurt the growth potential of autopart-makers and raw material producers of the country thereby affecting all engineering and manufacturing industries. The automobile makers have incurred losses despite modest growth in the production and sales of automobile units. However, rising production costs has dragged the corporation in the red zone.
The disparity of the rupee against the yen, high utility costs and petroleum prices have raised the cost of doing business greatly. The growth of local automobile makers will enhance economic activities manifold in the country with a definite increase in government revenues, new employment opportunities while saving much needed foreign exchange.
Therefore, automakers have stressed upon a one-point agenda in its budget proposal and this is the ‘continuity of policies and existing tariff systems’ but with only one guarantee that the policy will be formulated for long-term and no deviation will be undertaken, an industry representative insisted.

1 COMMENT

  1. The government of Pakistan should allow import only of new cars since there is no indigenous car manufacturing. All that is done are that car parts assembled. Even the parts of those cars which are no longer being manufactured by the company. Honda City is not longer being. The car ceased being made in 1994. The Suzuki Cultus ceased being in 1988. The reviews from the industry about these cars is that they are up to modern standards of performance, safety, safety and reliability. The government should consider the interest of the car buyers not the motley crew of car assemblers parading as car manufacturers There should be no booking fee, cars should be purchased immediately out of the showroom. The optimum standard for car is to be at least 2.5 cc or 3 cc not less. A car which has a small engine is too dangerous to drive, because it does not pick up in time and hence causes accidents. Companies claiming to sell high quality cars are lying their cars are substandard and completely unreliable. In Pakistan car buyers have a few choices in new cars Corolla, Civic, City. The bigger cars are called middle sized cars which are relatively safer but are too expensive.

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