KARACHI: Pakistan’s auto industry landscape is expected to see some new models from next year on, with Honda introducing subcompact crossover HR-V, Suzuki replacing Cultus with Celerio, and Toyota rumoured to start local assembling of Vitz and Vios.

Honda Atlas Cars (Pakistan) Limited will introduce HR-V — a 1,497cc completely built unit of Thailand origin — in January 2016.

Shabbir Alibhai, owner of Honda Quaideen Motors, told Dawn the company has informed its authorised dealers that the vehicle would cost around Rs3.5 million. The exact price, however, would be announced at the time of the launch based on the exchange rate.

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He said Honda has already ordered an initial lot of limited stocks. Customers would be paying an advance amount of Rs500,000 at the time of booking, and the balance one month before delivery of the vehicle.

Market sources said the carmaker also plans to unveil Honda Civic’s 2016 model, which has already been introduced in various countries, in the second half of next year. Besides, the new City model is also due for a change.

Sources said Pak Suzuki Motor Company Limited is also planning to replace its flagship Suzuki Cultus with Celerio — a 1,000cc hatchback — by end-2016 or the first quarter of 2017. The company may also unveil more new models after 2016.

Local vendors, who asked not to be named, said many of their counterparts are engaged in making parts and accessories.

In 2000, Pak Suzuki introduced Cultus replacing Khyber. In its span of 15 years, Cultus enjoyed a boom period with sales of 29,837 in 2006-07 and 27,563 units in 2007-08. Its sales, however, have floundered since then, dropping to 13,837 units in FY15 from 14,682 in FY14, as buyers shifted to used cars.

At a time when vendors are already producing Celerio parts, a Pak Suzuki official requesting anonymity said: “So far there are no plans for introducing any replacement of Cultus.”

Market is also abuzz with reports that the Indus Motor Company — the makers of Toyota cars in Pakistan — also considers starting local assembly of Toyota Vitz and Toyota Vios during 2018-2020. A spokesman for the company, however, dismissed such reports as “just market rumours”.

Auto assemblers and their vendors are making new investments cautiously, fearing any policy change in favour of imported used cars followed by a long delay in the announcement of new auto policy, a leading vendor said.

“Investment in the auto sector by the local industry will pick up pace once the industry is assured of policy consistency in the long term and curbs on import of used cars”.

He said the government must also consider reducing taxes and duties on locally assembled cars. Almost 35 per cent of a vehicle’s price is comprised of taxes, he said, adding that the government receives taxes worth Rs500,000 on a Honda City priced at Rs1.5m.

He said the government plans to offer incentives to new entrants in the upcoming auto policy. “The policy must also cater to targeting investments from existing assemblers as well as auto parts manufacturers who are in a better position to expand capacity and introduce new models at affordable prices.”

Published in Dawn, November 5th, 2015

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