Indus Motor Company to launch locally-assembled Hybrd Electric Vehicle next year

Indus Motor Company (IMC), the maker of Toyota automobiles in Pakistan, is expected to launch its locally-assembled Hybrid Electric Vehicle (HEV) by the end of next year.

The company’s top officials disclosed the development in a corporate briefing held on May 5 to discuss 3QFY23 (January-March) financial results and future outlook.

According to brokerage house Arif Habib Limited, which participated in the session, the management of Indus Motor stated that work on the hybrid facility is in progress.

Back in September 2021, the company had announced that it was going to invest $100 million in the local production of hybrid electric vehicles. The $100 million amount was to be invested over the period of three years, it stated.

“The company believes the demand for the locally produced hybrid model, which is expected to be launched next fiscal year, has come down from what was anticipated at the time of expansion,” said another brokerage house Ismail Iqbal Securities in a note.

“The local component in the hybrid model will be ~52%- 53%,” it added.

Last week, IMC reported a profit-after-tax (PAT) of Rs3.216 billion for the third quarter of financial year 2022-23, a decrease of 37% as compared with earnings of Rs5.118 billion in the same period of the previous year.

Earnings per share (EPS) stood at Rs40.92 compared with Rs65.11. The board of directors met on April 20 to review the company’s financial and operational performance in the first nine months ended March 31, 2023.

Along with the result, the company declared an interim cash dividend of Rs24.4 per share. This was in addition to the already paid interim cash dividend of Rs18.4 per share.

The industry, highly dependent on imports, has been caught in the midst of an exchange-rate crisis with players in the auto sector either passing on the impact of rupee depreciation to its customers or scaling back operations.

Pakistan’s auto industry reported car sales of 9,211 units in March, 62% higher on a month-on-month basis but still 66% lower compared to the number in March 2022, according to data shared by Pakistan Automotive Manufacturers Association (PAMA).

In October 2022, Indus Motor Company CEO Ali Asghar Jamali said at an event that “sales can drop to as low as 160,000 cars in fiscal year 2023 if suspension on import of completely knocked down (CKD) units persists”.

“Despite these challenges, the company will launch Corolla Cross as per plan next year,” he said then.

“Pakistan should develop a national industrial policy for a period of 20 years to attract investors to set up steel and plastic industries,” he added in response to a question on the sector’s future growth and high car prices. “Steel and plastic resins are currently being imported that drive the car prices higher.”