KARACHI, Dec 9: A new company has started assembling Korean buses at a local plant and it plans to roll out 500 buses during 2006. Afzal Motors Private Ltd entered into a technical assistance agreement (TAA) with Daewoo Bus Corporation, Korea, last year and the foundation stone of the plant at National Highway was laid on April 2005. The project cost is estimated at Rs500 million.

The local company has started the assembly of bus chasis from November 20, 2005 with initial deletion of 48 per cent, approved by the Engineering Development Board (EDB), while it plans to assemble the bus body from March 31, 2006, a senior executive in Afzal Motors told Dawn on Friday.

In a competitive market dominated by Japanese players for the last 20 years, the company plans to clinch 25 per cent market share initially, while competing with Japanese and some Chinese bus assemblers.

Figures compiled by Pakistan Automotive Manufacturers Association (PAMA) reveal that the local bus production in Pakistan went up by 27 per cent in 2004-2005 to 1,762 units from 1,380 units in 2003-2004. Hinopak Motors virtually enjoy the monopoly in bus segment, while Nissan, Dong Feng, Master and Isuzu have very negligible market share. However, production of Nissan buses has been suspended from July 2005, according to PAMA figures.

The executive said that the company aimed to produce 1,200 buses in 2007. The plant has directly created jobs for 450 people. The company also plans to assemble truck from June 2006.

He, however, said that the assembly plant has the capacity to produce 2400 buses and trucks on a single shift basis. It will also produce world class bus chassis and bus bodies for the domestic and export market.

The Daewoo Buses will be equipped with Euro-I, Euro-II diesel and dedicated CNG engines. The mass production of the front and rear engine buses has now started.

He said that the imported Daewoo buses were already plying on the Lahore-Islamabad Motorway and also in some parts of the southern Punjab.

A team of Korean engineers recently visited Pakistan to facilitate the assembly of buses and train Pakistani technical team on the job.

Daewoo Bus Corporation, Korea, has plans to export buses assembled at the plant in Pakistan to the Middle East and SAARC countries, he added.