KARACHI, June 28: As many as 100 more units of American-origin Chevrolet models (800cc), assembled in Korea, will hit the local market next month after arrivals of 100 units in the current month.
“We have already opened letters of credit (LCs) for the import of cars which will arrive in the market in July,” chief executive of Continental Motors, Saeed-ur-Rahman told Dawn on Saturday. The company is the sole importer of Chevy small cars in Pakistan.
Out of 100 cars, arrived in the current month, 54 units have been sent to Lahore, Multan, Sialkot and Islamabad, while 46 units have been reserved for sale in Karachi markets, he said.
Claiming that the consumers’ response so far has been very positive, he said that cars, namely Exclusive, are being sold at Rs575,000 and Rs600,000 for standard and fully-loaded models respectively. He said the company intends to import more cars depending on the market response.
The government has imposed 75 per cent customs duty on import of 800cc cars besides 15 per cent sales tax and other levies.
A local investor in Pakistan a few years back had planned to assemble Daewoo Matiz in the country but the project could not be materialised and plunged
in the doldrums. The Chevy from Korea is the same Daewoo Matiz. Since the Daewoo had become bankrupt, the General Motors had acquired the Korean car giant.
Saeed-ur-Rahman said that General Motors was reluctant to market its products in Pakistan but Mr Abdul Razzak, a retired executive on GM’s board, requested the company, which was later accepted.
Research Head, Invest Capital and Securities, Mohammad Sohail said that Dewan’s Santro Club and Suzuki Cultus 1000cc would face tough competition while Suzuki Alto 1000cc and Mehran 800cc would also face minor competition from the US origin car.
“The new company is likely to get good response from the recent boom in demand of cars and could capture two to three per cent market share in one year time,” he said.
An auto analyst at Khadim Ali Shah Bukhari said that finally, the much speculation going on about inexpensive Chinese cars at the port has been resolved. He said the new car is likely to generate interest among consumers. “I think that the pricing is likely to be an issue,” he added.
He said that with the local market flooded with small cars of 800-1000cc with a price range between Rs350,000-525,000 per car, pricing will be the key issue as consumers have exhibited to be very price conscious.
Pakistani car market is likely to see many changes ahead of opening of global markets in 2005, under the WTO regulations, when duties and slabs would be brought to zero level besides phasing out of quotas.
Markets are already abuzz with the news that a sizable quantity of Chinese 600-800cc cars have already been booked. However, so far Karachi Port has not confirmed presence of any Chinese car.
Reports are also swirling in the markets that Chinese Taxis are due to arrive at the port at a price ranging between Rs 100,000-125,000. Taxi drivers said that they were looking forward to the Chinese taxis at cheaper prices. Many taxi drivers are running their vehicles on LPG, while many of them have installed diesel engines in the taxis to safe the cost of running.
In two wheelers segment, a company is about to bring Korean bikes in the market and it has given an advertisement in local dailies last week for dealers. Japanese bike assemblers are likely to face another challenge in case Korean bikes start arriving. Consumers will now have a more wider choice to own the two wheelers. Local markets have already flooded with cheap Chinese bikes.
