As Pakistan aims for emerging-economy status, its automotive industry is already motoring along at a healthy clip. Annual passenger car sales recently topped 200,000 units for the first time, and all of the country’s automakers are planning production increases to satisfy brisk domestic demand.
New players are also flocking to this market of 200 million, lured by government incentives and the opportunity to tap a growing middle class. For now, there may be enough growth to go around, but these new faces — which include the likes of Renault of France and Kia Motors of South Korea — could threaten the dominance of Japanese makers.
Pakistan saw a record high of roughly 218,000 passenger cars sold in fiscal 2016, which ended last June. The leader was Pak Suzuki Motor, a subsidiary of Suzuki Motor, which landed an order from the eastern province of Punjab for 50,000 cars. The province’s government plans to use the vehicles as taxis as part of a job-creation program.
Indus Motor, a joint venture between Toyota Motor and local conglomerate House of Habib, is doing well with its mainstay Corolla, reporting that sales grew 11% on the year to 65,000 in fiscal 2016. “The market is so brisk that production can’t keep up,” said Indus Motor Vice Chairman Toshiya Azuma.
Azuma expects even more growth to come. “Demand in India, our next-door neighbor, is about 4 million cars [including commercial vehicles] a year, so annual sales of about 600,000 cars is well within reach in Pakistan.” The country has a population one-sixth that of India.
An alliance between Toyota Motor and Suzuki Motor could be a boon to both sides, helping the former gain ground in emerging markets such as India and giving the latter the engineering needed to compete in an increasingly high-tech industry.
Can’t go it alone
The two automakers said Wednesday they were discussing collaboration on environmental, safety and information technology.
Although Toyota President Akio Toyoda told a new conference that the idea of an alliance came together in just two business days after Suzuki Chairman Osamu Suzuki got the ball rolling, there is more to the story. Suzuki’s next partner had been the subject of speculation since August 2015, when the Japanese maker of economy cars ended a capital and business relationship with Germany’s Volkswagen over management conflicts.
Though Chairman Suzuki had said publicly that his company would look to remain independent going forward, another senior executive had acknowledged that collaboration was “necessary” in some fields. Even in India, a successful market for Suzuki, environmental regulations are growing tougher, making investment in technology like hybrid drive systems essential. Rising incomes have also stoked demand for higher-end vehicles in such countries.
Finding a big automaker ally was seen as essential for Suzuki to ensure a presence in self-driving cars. While a Toyota or a Volkswagen has the financial strength to counter the challenge posed by Google and other tech giants in this field — Toyota’s annual research and development budget comes to around 1 trillion yen ($9.59 billion) — Suzuki, which spent just 130 billion yen on R&D in the year ended March 31, hardly stands a chance alone.
Toyota Motor announced on Sunday that it will suspend most car production across Japan after a crucial part of its supply chain was cut by the two earthquakes which devastated the southern Japanese island of Kyushu.
The automaker will halt production at all of its major assembly lines at its four directly-run car plants, and will suspend production in stages at other group companies. According to a Toyota announcement, five assembly lines will stop at its directly-owned factories in Takaoka, Tsutsumi, and Tahara from April 19 to 23, followed by two production lines at Tahara and Motomachi from April 20 to 23. This means that all seven of Toyota’s directly-operated mass assembly lines will be shut down. Group companies will also suspend most of their production between April 18-23, shutting down most of the entire Toyota group in Japan. It is expected that as many as 50,000 vehicles will be lost in the shutdown. Production affected includes popular models such as the hybrid Prius, the Crown, the Land Cruiser and Lexus. “Decisions regarding recommencement of operation at plants in Japan will be made on the basis of availability of parts,” the company said in its announcement.
Luxury car maker Mercedes-Benz on Thursday said India’s Ministry of External Affairs (MEA) has placed an order to lease 55 top of the range E 250 CDI luxury sedans.
The high-end sedans will be used by the visiting foreign dignitaries of ministries including the head of states, presidents, prime ministers and top diplomats, it said in a statement.
Mercedes has so far sold over 30,000 units of the E-Class in India and is the first luxury car to be produced in India since 1995. It also remains, by far, the largest selling luxury car model in the country today, the firm added.
Mercedes-Benz India CEO and Managing Director Roland Folger said the company has always been the preferred luxury brand for Head of States across the globe including India.
The Toyota group plans to build some 10.3 million automobiles worldwide this year, with record production in North America and China seen offsetting a drop in domestic output, The Nikkei learned Friday.
The Japanese automaker is set to hit another industry record. Production will top the 10 million mark for the second straight year, following planned output of 10.12 million vehicles for 2013. The figure includes production by group firms Daihatsu Motor and Hino Motors.
The parent firm, which handles the Toyota and Lexus brands, anticipates record production of more than 9.1 million units, compared with a target of 8.9 million for last year. Domestic output is seen declining by 250,000 from the 2013 plan to around 3.1 million vehicles on account of the consumption tax hike in April, but overseas output is estimated at 6 million units, up 450,000.
The parent expects to build roughly 2 million units in North America, an all-time high. In the U.S., where sales of new autos are strong thanks to an economic recovery, Toyota aims to boost sales by 3% to 2.3 million units. Plans call for expanding local production partly by shifting SUV manufacturing from Japan to the U.S. Read More
A husband and wife were having dinner at a very fine restaurant when this absolutely stunning young woman comes over to their table, gives the husband a big kiss, says she’ll see him later and walks away.
His wife glares at him and says, “Who the hell was that?” Read More