IMC Boss Optimistic About Auto Sales Recovery

Despite a staggering 50% decline in car sales in recent months, Toyota is hopeful that the Pakistani auto market will soon reanimate and reach a 500,000-unit milestone by 2030 amid improving economic indications.

For the second month in a row, local assemblers (PAMA members) managed to sell less than 5,000 passenger cars in a month in November, adding 4x4s & SUVs the figure reached around 7,700 units which was 60% lower than the numbers from the previous year. The combined sales have dropped by 50% to just 33,638 units in the first 5 months of the current fiscal year (July-November) as compared to 67,104 units sold during the same period last year.

Related: IMC- Optimism or Empty Rhetoric?

Even though the auto industry is still dealing with a persistent sales crisis, automakers are optimistic that the market will recover soon. According to the worldwide statistics and business intelligence platform Statista, the passenger car market in Pakistan is expected to generate more than $4 billion in sales in 2023.

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Ali Asghar Jamali, the chief executive officer of Indus Motor Company (IMC), the assemblers of Toyota cars in Pakistan, showed optimism while talking to Arab News in an exclusive interview. According to Jamali, the auto industry was operating at up to 30% of its capacity, but things will improve from January 2024 due to agricultural revenue, different budgetary measures implemented by the government, and, most importantly, the impending elections on February 8.

Drawing momentum from improved economic indicators, the IMC boss predicted that the auto market would surpass 350,000-unit yearly sales in the next two years and reach the 500,000-unit milestone by 2030. Though the forecasted numbers are yet to be reached in Pakistan’s auto market history.

Related: IMC Unveils Toyota Corolla Cross Hybrid and its Prices

Despite the obstacles, Toyota unveiled its first locally assembled hybrid electric vehicle (HEV), the Corolla Cross, in Pakistan earlier this month, which is more than 50% localized in terms of value, according to Jamali.

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Highlighting the $100 million investment behind the project, the IMC boss explained the reason behind the introduction of this car despite tough economic conditions:

“Toyota has decided to launch its product because times are tough right now but this too shall pass and remember, we are not in a sprint, we are in a marathon. We constantly invest in Pakistan so this product that we brought in here, we invested $100 million. There is investment that is constantly going on and right now also, we’re investing in our products to enrich, to bring new products.”

Jamali, who is a former chairman of PAMA, said his company was also in talks with the Pakistani Ministry of Industries & Production for the export of automobiles from Pakistan. He said:

“Right now those discussions have just started. We are going to submit some plans to them, obviously, we do plan to do some exports also, but because in the case of auto, we’ve just started and there is a lot of impedance.”

Jamali said the IMC was focusing on the countries in the African region, where a market existed for right-hand drive vehicles. He revealed:

“We are looking into those markets to tap those markets and we are working with both the government of Pakistan and Toyota Motor Corporation [as to] how we can tap these markets so that we can also have some export from Pakistan.”

But to do that, Pakistan needs localization and an upsurge in production to increase the export of automobiles to other countries, according to the IMC chief. Talking about the benefits of localization, Jamali said:

“Localization is the key. If you don’t localize, how will you export? If you localize, obviously your competitiveness will increase to export, so that’s the key. If you’re going to import everything, how can you export?”

Pakistan could increase the export of some basic raw materials including fabric, leather seats, auto parts, and vehicles at present, which would go up with the increasing volume, Jamali suggested.

Source: Arab News 

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