KARACHI, March 6: Local assemblers and vending industry representatives are meeting finance minister Shaukat Aziz next week to lobby for their case against the cabinet's approval of the task force recommendations specially its decision to allow import of reconditioned cars.

Car makers are expected to present their case before the finance minister on March 10, while auto parts makers will meet the minister on March 9, sources in the auto industry told Dawn.

Local assemblers have already geared up their efforts to force the government to withdraw its decision. Car makers have also been urging the governments' high-ups not to disturb the present tariff rates on the import of completely knocked down kits (CKD) and built-up cars.

Before reaching country's top economic and finance manager, car industry representatives also met high officials of the State Bank (SBP) last week to present their viewpoint.

They informed the SBP officials that import of used cars will ultimately result in halting fresh investment and expansion plans of the car industry. They said that the industry has come out of the red after two years of sluggish performance.

The industry, after doubling their production, is looking forward to further enhancing the production capacity as well as investments to curtail the delivery timing of booked cars.

However, assemblers feel that any change in the current policy and tariff rates would only stifle the growth of the auto industry and of 600 engineering units manufacturing parts for it.

Despite achieving double car production, genuine customers have to undergo a mind boggling experience for waiting two months to eight months to drive the newly booked cars. In case of hurry, customers are bound to pay high premiums depending on the models.

Assemblers think that the delay in getting the new car is largely because of large-scale speculative booking by investors and brokers who book cars only to sell them later at a premium to the waiting customers. They say that the increase in production has reduced the waiting period, and the premium charged by the middlemen for on the spot delivery has considerably come down.

Individual customers are the real sufferers. For instance, they will have to wait at least five months to get the delivery of the Hyundai Santro if it is booked today. However, if the customers intend to buy it through leasing, then the delivery period ranges between two to three months. Otherwise, a customer has to arrange a premium of Rs35,000 and Rs40,000-45,000 for the standard and a fully loaded Santro models respectively.

Delivery timing for the newly-booked Suzuki models also range between two to three months besides carrying premiums in case of on the spot deliveries. Customers will have to wait four to eight months for Toyota Corolla and Honda cars and premiums are still being charged for ready deliveries.

Manufacturers, who had expanded their capacity to meet the unexpected demand spurt fuelled by easy and cheap bank and lease finance, have paid half-hearted attention to check their authorized dealers properly who are also involved in the game of making windfalls through premiums on new cars.

Meanwhile, car dealers' lobby has also accelerated its efforts to get implemented the Cabinet's decision of allowing used cars as soon as possible. They have sent proposed duty rates on the import of reconditioned cars.

The chairman, All Pakistan Motor Dealers Association (APMDA), HM Shahzad, in a letter to Prime Minister, Mir Zafarullah Khan Jamali on Saturday, suggested the rate of 25 per cent import duty on cars up to 800cc to 1,000cc and 35 per cent duty on above 1,000cc to 1,500cc and 50 per cent import duty on above 1,500cc to 1,600cc and 65 per cent on above 1,600cc to 1,800cc. He urged the government to allow used car imports of 1994 models and onwards.

He said that the existing policy of maximum depreciation also requires a review. As to the maximum depreciation, which is currently at 50 per cent of the freight on board (FOB) value, should be on 50 per cent of the cost, insurance and freight (CIF) value instead of FOB value.