Used Cars import destroying local industry

KARACHI: Any further relaxation in used vehicles’ import will result in total closure of local auto makers with a job loss of more than 2 million workers in auto and allied engineering industry. This was stated by a spokesman for Pakistan Automotive Manufacturers Association in a statement issued Tuesday.

The spokesman said that allowing import of five years old cars was already causing embarrassment to the government which allowed the same to make cheaper cars available to consumers but most of them are priced at the rates of new locally made cars.
The tax evading trader mafia has mustered the courage to further this embarrassment by demanding relaxation on commercial import of used cars up-to 10-year-old which is suicidal for our already precarious economy.
PAMA Spokesman said the auto industry has been deeply perturbed by this new ridiculous demand of a lobby which does not contribute in job provision or technology transfer and evades taxes on large scale besides under invoicing and fleecing the customers.
He said that the trader lobby has not only asked the Federal Minister of Commerce to further relax the age limit of used imported cars from five years to 10 years but also to allow the commercial imports of the same. “This will destroy the local industry and would make Pakistan a junkyard," he said warning that the resultant job losses could create serious social situation for the GOP.
He further added that now the local market is flooded with used imported cars but their rates are extremely high compared with their age. A used imported four-five years old Suzuki Alto with an engine of 650 cc and depending on condition is being sold in the local market at Rs700,000 to Rs750,000 where as customer could buy brand new locally made alto with 1000 cc engine for this much money.
Similarly, he said that another most imported brand Vitz costs a little over Rs.1.1 million while its parallel version Suzuki Swift is marketed by local manufacturer at the same price. Furthermore, he added that mostly luxury cars are being imported which is depriving GOP of precious foreign exchange.
The spokesman said the government definitely has all the information in this regard and should have reprimanded the dealers that assured that the rates of used cars would be much lower to benefit the consumers.

Copyright NNI (News Network International), 2011