Honda halts production in Pakistan, Indus to follow

[Crusher]

Bro,

Auto policy is the STICK needed to fix these companies. Government can make lot of difference in any area, if sincere.

You represent status quo on every issue and Imran Khan I believe is fighting against Status quo.

 

[LeGenD]

You represent status quo on every issue and Imran Khan I believe is fighting against Status quo.

Care to elaborate?

 

[Crusher]

Care to elaborate?

Just my observation after reading your posts on various threads during the past few months since I created my account.

 

[LeGenD]

Just my observation after reading your posts on various threads during the past few months since I created my account.

Difference of opinion is understandable but your mindset is not healthy. Friendly tip.

I believe I pointed out this to you in another thread where you were advocating outright ban of social media platforms in Pakistan. You adhere to Fascism, my friend.

 

[Crusher]

Difference of opinion is understandable but your mindset is not healthy. Friendly tip.

I am going to put your "healthy mindset" on my ignore list, bye bye.

 

[LeGenD]

I am going to put your "healthy mindset" on my ignore list, bye bye.

Thank you.

 

[airmarshal]

Realisticially, Pakistan total car demand in a year is around 100k units. With this number, we cant expect price to go down.

If Pakistan really wants to get maximum benefit from setting up auto industry, it will have make policies that are export oriented. Look at Thailand, Turkey and Morocco. They have become export hubs. Most of our Honda car parts imported from Thailand.

 

[mkg00179504]

Car companies offer 0% apr and discounts to customers all the time in UK. I have even seen BMW dealers selling cars at zero margin just to keep the stock moving but in Pakistan, companies wont cut the profit margins and try to charge premiums on top of it.

Same in the US. My brother got his first car Infinity with loads of options and for such a good price because the dealer wanted to get rid of it. But in Pakistan ow boy Premium means seat belts. People get crap for their money and yes one more thing . Suzuki has been selling shit in Pakistan that no one will ever buy.

 

[Pandora]

Auto Policy - ever heard this term?

Australian auto policy mandate safety features - above GLOBAL norm.

You won't find Suzuki Swift with 8 safety bags outside Australia - 2 is norm in many countries (front seats).

Pakistan is really late to devise an auto policy because governments were sleeping here. PML(N)-led GOP did the needful in its most recent term. Thanks to this initiative, new companies are opening showrooms here and driving competition.

Due to new entrants such as KIA, Hyundai and Renault, existing brands such as Honda, Toyota and Suzuki are under pressure to introduce better cars here.

Suzuki have revisited its line-up and introduced a new set of cars with necessary safety features which is a POSITIVE development. These cars might not be world class but still better than previous ones. In fact, better than expected but many won't give as much credit due to preconceived notions.

Suzuki Alto is a big leap from Suzuki Mehran - a step in the right direction. In the given price range, their are no locally manufactured alternatives in Pakistan, and imported ones are all REFURBISHED.

Chinese alternative for Suzuki Mehran in Pakistan (United Bravo) is FRAUD - very poor built quality.

Yes, you are bullshitting. You suck your own bullshit downwards up and more.

Better yet don't draw silly comparisons. Pakistani auto market conditions are vastly different from Australian auto market conditions.

PTI-led GOP can improve Pakistani auto market conditions if it really want to. However, this is not its priority at present.

Janab now that you have mentioned Australia let me educate you that they dont manufacture even a single nut or bolt in Australia at present. Heck they dont even bother to assemble them in Australia. You have to pay same amount of tax in Australia as in Pakistan sometimes even more. I will give you example of suzuki swift which is priced at Rs1770013 or 15990$ where as the ones on pakistan are priced at 19 - 22 Lac Approx.

This is what you call getting what you paid for (tax included which is almost 10%)
https://www.suzuki.com.au/vehicles/models/swift/specifications

This is what you call bending your customers over and taking them for a ride repeatedly.
https://www.pakwheels.com/new-cars/suzuki/swift/

I am an Engineer who worked his career in Automobile industry in Australia and you telling me about how build quality is similar in Australia and Pakistan which is one pathetic joke.

Also There was moron here who was telling me earlier that Suzuki makes on 11000 Rs profit on every suzuki Alto .

Average profit per assembled vehicle = Rs. 1,890,000,000/161,149 = Rs. 11,728 ONLY!

Do you really believe that Suzuki is ripping us off by charging an average profit of Rs. 11,728 per vehicle?

Sorry i admit i kinda skimmed through your BS earlier. I just had to come back for this Gem from you . That is why they say leave the economics to economists.

 

[Mav3rick]

Sorry i admit i kinda skimmed through your BS earlier. I just had to come back for this Gem from you . That is why they say leave the economics to economists.

You don't have to go full retard, I mean I can understand your failure at coming up with a response, let alone a decent one. And it is not because of your intelligence, or lack of it, which you have displayed here amply; but simply because one cannot fight facts with the BS you have been posting!

That is like purging the Mafia and some people crying about loss of jobs and livelihoods. Fact is most of car industry is a mafia racket that is made up of foreign companies and local gangsters. All intended to scalp the captive local consumer. After enjoying nearly four decades of state protection and monopoly please tell me one achievement of the car mafia other than raping the poor Pak consumer? Exactly how many cars do they export? If not why not? Think of the cheap labour costs in Pakistan? Think of number of Paks killed by this mafia caused by producing cars that are at least two decades behind in safety technology?

Time to turf out the weed and let some fresh grass take root.

I cannot really answer for the mistakes of the Government, for not having a decent auto policy, or for the manufacturers which kept quality of the vehicles low. And I think it is criminal that these companies still have not established manufacturing in Pakistan and are still importing Kits. Let's also have a thought for the massive import duties imposed by successive Governments to stifle imports import of reconditioned/used Japanese vehicles.

As for the mafia, we have Water Tanker mafia, Transport mafia, Land mafia, Sugar cartel, pharma cartel and on and on and on. We must break up cartels and monopolies but with good policies and competition. But in a way which does not affect the livelihood of the common man. We don't even have to look far, we can simply adopt Indian Auto policy, to start with.

 

[IceCold]

Does the premium go down? If not then they are fooling the customer.

Agreed. Neither the premium nor waiting time is being decreased. If they have units readily available why not fill showrooms with ready delivery options. Work with banks and state bank to lower the conditions imposed on average user for leasing. It's a gigantic problem to get a car on lease if are using any bank product even when can afford monthly installment.

 

[Pandora]

You don't have to go full retard, I mean I can understand your failure at coming up with a response, let alone a decent one. And it is not because of your intelligence, or lack of it, which you have displayed here amply; but simply because one cannot fight facts with the BS you have been posting!

I have already posted statistics in this thread which are facts and figures posted on reputed websites. As for you only reason you are coming up with are your brain farts with no facts what so ever. You are calling me retard when you cant even multiply or divide properly. I really hope these companies are paying you to be their kiss asss or you at least get a Suzuki Alto out of it. You and that recycled junk Alto are made for each other.

 

[War Thunder]

Good for Pakistan and Pakistanis. Bad for these looters.

 

[Sugarcane]

Very nice post, very intelligent too. Kudos on your attempt to win arguments with non-linear language. Anyway, I would advise you to reconsider and research the profits you have posted, and to focus on net profit rather than gross. I would also like to do some math, please correct me if I am wrong (we shall consider M/s. Suzuki as an example):

M/s. Suzuki's Net Profit for FY 2018/19: Rs. 1.89 Billion = Rs. 1.89 * 1,000,000,000 = Rs. 1,890,000,000

Units produced by M/s. Suzuki in FY 2018/19: 161,149
Average profit per assembled vehicle = Rs. 1,890,000,000/161,149 = Rs. 11,728 ONLY!

Do you really believe that Suzuki is ripping us off by charging an average profit of Rs. 11,728 per vehicle?

Also, please enlighten us which locally available alternate should one consider instead of Alto, Cultus, Gli, Xli, Altis, VTec, Turbo etc.? What choices really are available to us?

P.S. It is the insane exchange rage, I mean rate, that is driving up the prices to insanity, add to that the enormous import duties and you have madness! And yes we import 70-80% of locally assembled vehicles in KDC including chassis for most of the locally assembled cars, engines, transmissions, bodies etc.

Sir, Please take into account following points

1. Auto Manufacturers get full payment months in advance, So they are managing business with money of customers. Less financial risk = less reward, higher financial risk = higher reward is basics of business.
2. Major portion of manufacturing cost of car is the CKDs/SKDs which are manufactured by same company / associated partners in different country and is sold on profit to company in Pakistan. So, profit in Pakistan is just a portion of profit for parent company actual profits are taken from these CKD/SKDS & Parts.

I personally know a Japnese company (although not auto manufacturer itself but linked to industry) whose local company is in loss for years but still don't close the company. Reason is that they are earning profits on raw materials they are selling to that local company to manufacture products, the loss in local subsidiary is much less than profits earned on raw materials hence despite being in loss that subsidiary company is contributing to consolidated profits.

 

[Umair Nawaz]

Honda halts production in Pakistan, Indus to follow
Nasir JamalUpdated July 13, 2019
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LAHORE: Honda Atlas Cars Pakistan (HACP) shut down its plant for 10 days on Friday as its inventories piled up to 2,000 units on plummeting car sales amid rising prices due to imposition of new, higher taxes in the budget and steep currency devaluation in the recent weeks.

Similarly, Indus Motor Company (IMC), which produces Toyota models in Pakistan, has also decided to stop car production for eight days, two days every week, during this month, company sources told Dawn.

Honda had kept its plant closed for two days earlier last week. However, a Pakistan Suzuki Motor Company spokesman told Dawn the company will take decision whether or not to cut down production in the next few days after analysing sales trend and flow of booking orders during the present month.

HACP and IMC executives, who spoke to Dawn on the condition of anonymity, said their decision to scale down production during July was informed by extremely lacklustre sales in the first 10 days of the current month.

ARTICLE CONTINUES AFTER AD
“Our inventories from the last month and the first 10 days of July have grown rapidly because of steep increase in car prices after currency devaluation as well as imposition of Advance Customs Duty (ACD) on all our imports and Federal Excise Duty (FED) on assembled cars, leaving us with no option but to shut down the plant to cut production. If the present trend holds, we expect our sales to drop to less than 30,000 units this business year (April 2019-March 2020) from over 48,000 units last year,” a senior executive of HACP elaborated.

An IMC official also gave the same reasons for “observing eight no-production days” during July. “It is a very serious situation for the local car manufacturers who are piling up inventories,” he said. But he did not give the size of inventory his company has built so far, saying the production cuts could increase next month if sales do not pick up.

The sales have been on the decrease for the last three months as total car and light commercial vehicles (LCV) volume contracted by 5pc to 17,561 units in June from a year ago. Overall, the car and LCV sales plunged by 7pc during the last fiscal year to 240,335 units from the previous year. The impact of implementation of 5pc ACD on all raw materials and parts used by the local assemblers and imposition of 2.5-7.5pc FED from July 1 has started resulting in further decline in sales.

Industry sources expect a significantly large dip in sales at the end of the year. It may be recalled that the industry was expecting to increase its sales to half a million units by 2022.

Published in Dawn, July 13th, 2019

Good! now government should take them over and resell them like Turkey's Erdogan does, who can run them in profit with better services and manufacturing as well as new models