Auto assemblers gear up to tap export markets

Published August 22, 2021
Workers assemble motorbikes at a D.S. Motors manufacturing unit in this file photo. — White Star
Workers assemble motorbikes at a D.S. Motors manufacturing unit in this file photo. — White Star

KARACHI: Motorcycle and rickshaw assemblers have been striving to tap African markets besides aiming to boost their exports to Afghanistan after business environment gets normal following takeover of Kabul by the Taliban.

Rickshaw makers are trying to break the decades-old monopoly of an Indian auto giant Bajaj in various countries, especially in African countries. The task is gigantic, but they are optimistic about carving out a niche for themselves in the coming years.

Sazgar Engineering Works Ltd (SEWL) chief executive Mian Asad Hameed told Dawn from Lahore that after successful trial of 50 units sent four months back, the company will now export 170 more rickshaws to Ethiopia next month, which is an encouraging sign.

He said he had also sent a technical team to Ethiopia to lure an Ethiopian counterpart for setting up an assembly line there under a joint venture agreement.

“It is hard to break the monopoly of an Indian auto giant that reportedly sells 400,000 rickshaws all over the world every year but my target is to develop an export market by increasing volume in the coming years to various countries,” he observed.

SEWL has exported around 2,000 rickshaws to African countries and Afghanistan including 200-300 to Japan in the last three years at a price of $1,500 per unit, he said, claiming that SEWL is the first company to ship the automobile to Japan.

He said Sudan is also emerging as a big export market for rickshaws. “Calm in Afghanistan after Taliban’s rule may open new export avenues for rickshaw exports,” he hoped.

Mr Asad said Covid-19 has been a hurdle in sending local industry officials abroad to market Pakistani rickshaws for boosting exports. The pandemic has also restricted foreign investors from visiting Pakistan.

Eyeing car assembling

SEWL will soon be starting car assembling and SUVs. “Here we have a good chance to export them especially to Afghanistan and other regional markets and African countries,” he hoped.

Engineering Development Board chairman Almas Hyder said the government is focusing on “Africa Look Policy” to boost auto sector exports.

Massey Ferguson, the assembler of Millat tractors, has been exporting the farm vehicles for the last 10 to 15 years and the numbers have been growing. An official said the company had exported 2,000 tractors in FY21 to Afghanistan, African countries, Far East, Myanmar and Malaysia at a price of $15,000 per tractor of 85 horse power.

“We have set an export target of 4,000 tractors for FY22 as new markets are also being explored coupled with high hopes of increasing tractor exports in Afghanistan and African countries,” he said, adding some private parties after lifting tractors are also exporting in low volumes.

Bike exports

Atlas Honda Limited (AHL) has been exporting bikes (70-125cc) for the last over 10 years to Afghanistan and other foreign destinations. An AHL official recalled that the company had exported 20,000 units a few years back, but the number has now dipped to 4,000-5,000 units a year. “We are now exploring African markets where heavy bikes are in high demand,” he said.

Japanese car assemblers like Honda and Suzuki did not respond over the query as to how many vehicles they had exported in the last three to five years or before that.

However, an executive in Indus Motor Company (IMC), the assembler of Toyota vehicles, told Dawn that the company had exported 100 or 200 Toyota Corollas to Sri Lanka a few years back. He however did not offer any comment as to why Corolla could not be further exported later on.

Director Mehran Commercial, Mashood Ali Khan said the total population of Africa is approximately 1.32 billion, ie 16.72pc of the world’s population, inhabiting 54 countries suggesting a huge export potential but trade volumes had remained dismal due to low level of engagement with Africa.

He said India and China have made strong marks in the African markets with their products as they have invested in assembly lines, supply chains and aftermarket distribution networks.

Mr Mashood said the relevant ministries are building relations with other governments in Africa to create linkages for Pakistani products.

Published in Dawn, August 22nd, 2021

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