Indigenization for Higher Sales Growth of Automobile Industry

By Khan, Qazi Ebadullah | Economic Review, November 2009 | Go to article overview

Indigenization for Higher Sales Growth of Automobile Industry


Khan, Qazi Ebadullah, Economic Review


Pakistan is a populous country of over 160 million people aspiring to move ahead in all spheres of its economic growth and development. The genesis of our automobile industry in Pakistan takes us back to 1963 when the nascent automobile assembly in the country was first set up for Bedford Trucks with CKD imports from Vauxhall Motors, U.K. Then General Motors Overseas Distribution Corporation, USA and later re-titled as Ghandhara Industries Ltd. was a name that Pakistanis felt proud of. It was later followed in quick succession by other automobile assemblers for cars, jeeps and trucks.

[ILLUSTRATION OMITTED]

Until early 1960's the British, German and American vehicles completely dominated the growing domestic market though there were also few imports from other European countries as well. It was in the first half of the 1980's that Japan entered our market with introduction of Toyota Corona cars which was there in direct competition with other European cars in the likes of Volkswagen, Morris, Hillman, Austin, Ford, Opel and few others. Within a decade almost all the European cars were virtually off our roads and the new entrants were the Japanese and the Koreans.

[ILLUSTRATION OMITTED]

Suzuki Motor Company had the vision to correctly evaluate the growing market needs and set up it's automobile assembly plant by introducing cars, pickups and vans in the engine capacities of 800cc - 1300 cc, catering mainly for the lower and medium income groups which was a large growing segment that made their investment feasible. This was followed by the growth of downstream automobile vendor industry for providing cost-effective indigenous parts. Indus Motor Company followed by Honda Atlas Cars made entries to cater for the middle and upper middle end market segments, with the introduction of 1300 cc - 2000 cc cars. Later other makes of Japanese and Korean automobiles and assemblers also made entries to the market.

An overview of the past five years of car sales(as tabulated below) when categorized into two broader categories based on engine capacities, enables us to witness that the highest production and sales volume exists in the 800cc. - 1200c.c. range, followed by 1300 c.c. - 2000 c.c. range.

It is observed that the lower and middle income group constitutes the target market for higher growth and in order to achieve and sustain it will require an affordable, fuel efficient quality vehicle that will cater to the comfort of the users.

This large customer segment needs to be tapped who are waiting on the side lines for acquiring a safer and better transportation needs and this can be possible if our auto and vendor industry adequately invests in higher technology and skills to be able to provide locally developed quality parts for vehicles at competitive prices which will in return generate the volumes for economies of scale transportation by acquiring latest arising from the higher demand.

We can either continue to manufacture of all components maintain our lackadaisical approach in not fully indigenizing the parts for the automobiles to bring down the, cost of the vehicle and the prices to affordable levels by maintaining status quo or proceed ahead keeping in view a large and a growing population with it's needs for safer transportation by acquiring latest technology for complete local manufacture of all components used for manufacture of cars as this will be the path to improve productivity and reduce cost.

Pakistan today proudly claims to be the world's cheapest producer of quality tractors, which has not only been able to sustain all the threats of the external environment but has continued to progress on the path of growth and profitability. If we can do it in tractors we can very well do it for cars provided our multinationals are willing to invest in the complete transfer of technology including the local manufacture of all engine and transmission components. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

Indigenization for Higher Sales Growth of Automobile Industry
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.