This is in response to the letter by Iqbal Mirza that appeared in the Business Recorder on Monday, March 21, 2005. Though we welcome comments and suggestions from our valued customers however what Mirza has mentioned in his letter does not reflect the factual position. Therefore, in the capacity of Indus Motors' media relations agency, we would like to put forward some facts on behalf of our client, for the benefit of the customers and your readers.
Bookings are suspended occasionally to avoid a heavy backlog of orders and are kept at a level compatible with the production capacity. This is a customer-friendly policy, being adopted by the automobile industry in general, so that the extremely long waiting times are reduced, customer funds are not blocked and non-genuine buyers are discouraged.
Another important fact is that premiums are being charged by investors, and unauthorized roadside dealers on the cars booked for reselling. Charging of premiums is not particular to any manufacturer but all manufacturers having popular products are facing this problem on their products through malpractices of the investors. IMC does not charge premiums. In fact in order to discourage premiums, IMC has taken several measures on its own initiative to protect genuine customers. These include:
All documents are subject to a detailed scrutiny, including Provisional Booking Orders, customer details and copies of NIC. These documents must be complete in all respects (name, address, phone contacts, etc).
Compulsory registration in the name of the customer, who has booked the vehicle and all vehicles are delivered after registration
Only one booking accepted at a time, on one NTN/NIC, for booking by individuals. Multiple orders, if received, are refunded.
Only new NIC (NADRA) is accepted
Payment instrument should mention "account of the customer"
Mystery buyer surveys are conducted by IMC to check malpractices. Recently the IMC cancelled over 2,000 orders of such investors and refunded the full amount to them.
Some customers unwittingly become victims of these investors and resellers by paying premiums to them as due to some urgency they do not want to wait for the specified delivery period. This in turn encourages investors and hence the premiums are further increased. As far as the delivery periods are concerned, the important point to be noted is that this phenomenon is not unique to Pakistan.
Delivery periods longer than what is offered in Pakistan exist in Indonesia, Thailand, Malaysia and other countries. One case in point is the new model of the multipurpose compact car, Avanza. The delivery period for this model is as long as 14 months in the above mentioned countries. One must reflect on the fact that the supply-and-demand gap is a universal phenomenon for all car models that are in high demand, all over the world.
Solution to the above-mentioned problems lies in the increase in production, which, needless to mention, is being significantly undertaken by all manufacturers.
The following table shows the comparative figures for the last 4 years and the current year:
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PAMA Production
Installed Planned
Capacity pa Capacity 04-05
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00-01 01-02 02-03 03-04 04-05
Jul - Feb
TOTAL 108,000 194,000 47,117 49,656 75,441 113,655 89,208
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As is evident form the table the industry is constantly enhancing production capacity and production figures for 8 months of 04-05 are almost 78 % when compared to production figures of fiscal year 03-04. OEM's are actually ready to further enhance the production capacity to meet the increasing demand.
However, considering the current deletion policy of the government vendors are too striving hard to increase their production to supply the parts to OEMs in the required quantities.
According to the findings of the task force constituted earlier by EDB, it was concluded that car prices for most of the models are lesser in Pakistan in comparison to India. This is a big support to the consumers. However, this is also one of the major reasons for higher demand and waiting period on deliveries.
We hope that the above stated facts will facilitate the readers and our customers to better understand the complexity of the issues facing the Pakistani automobile market. The entire auto industry, including Indus Motors, along with the government, is striving hard to reduce the demand-and-supply gap.
The car manufacturers, the government, the customers and the general public are all equal stake holders of the auto industry and all must join hands to make it a globally competitive industry.
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