KARACHI, April 6: As the local car makers gear up production to meet the rising demand, dealers and importers of second-hand cars claim that selected authorized dealers of assemblers are still charging premium on new models.

All Pakistan Motor Dealers Association (APMDA) has informed the Ministry of Commerce that Indus Motors has accepted blank bookings of 900 new Toyota Corolla XLI cars from their nine favourite dealers from all over the country — four of them from Karachi, three from Lahore, one from Islamabad and one from Rawalpindi.

APMDA said that each of them had booked 100 cars against the advance payment of full cost to the company. These dealers are selling the booking papers at the premium rate of Rs250,000- 300,000 to the actual buyers.

“These dealers, who will get the delivery of first 900 cars, will sell the cars at the premium rate and share the premium income with the assemblers,” APMDA’s letter said.

Other makers of Honda and Suzuki are also working on the same line to squeeze money from the buyers. The situation of charging premium on cars (from 800cc to 1600cc) by various dealers, is still going on, ranging between Rs5,000 to Rs190,000, market sources said.

Giving a solution to this practice, APMDA has again urged the Ministry of Commerce to allow import of used cars at a reasonable rate of duty.

The government has warned the car assemblers of opening import of reconditioned cars if they fail to double their production by May 10, 2002.

But on Saturday, Commerce Minister Abdul Razak Dawood twisted his tongue in favour of the assemblers by assuring them that import of cars would not be allowed. A month back, the minister, in a Chinese truck launching ceremony, created a stir in the car market by saying that the government would allow import of used cars in case they (assemblers) failed to increase the production to meet the rising demand.

Mr. Razak and even Secretary Industries Dr. Akram Shaikh continued to hold various meetings with assemblers, giving a caution to them of opening imports of used car, but Saturday’s press briefing seemed quite in favour of assemblers and took everybody by surprise.

Assemblers have finally succeeded in their tactics to convince the commerce minister before the government takes any decision in the upcoming budget regarding opening of import of used cars.

Razak Dawood also said that the delivery time of cars would be restricted to three months and assemblers would pay interest in case of delay in delivery. But the minister did not give any details as what problems would be faced by the customers, who had been asked to get the deliveries of cars from September this year to April next year.

Indus Motor Company, makers of Toyota Corolla, said that one factor to boost car demand was attractive car financing schemes and sudden increase in home remittances in the post-September 11 scenario.

The company in a statement said certain vested-interests were working according to well defined strategy to have the ban on used cars lifted. “It is now justified for not increasing the production of cars to meet this temporary surge in demand,” it said.

The auto industry employs over 200,000 people directly and indirectly and the contents of local parts in cars range between 40-70 per cent.

Meanwhile, president, Federation of Pakistan Chambers of Commerce and Industry, Iftikhar Ali Malik, has urged the government not to allow import of used cars as it would not be in the interest of local car industry.