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KARACHI: Indus Motor Company, the maker of Toyota-brand vehicles in Pakistan, is betting on its upcoming hybrid car, the Corolla Cross, to do well at a time when petrol prices have already hit a record high and are tipped to go higher in the country.

“Hybrid vehicles will do well as it consumes 50% lower fuel,” said Indus Motor Company CEO Ali Asghar Jamali in a press briefing with journalists on Wednesday.

“HEVs are the most sustainable solution to the country’s economic problems.

“Pakistan is one the worst victims of climate change and needs strategic measures on every front to address these challenges.”

Jamali said HEVs are the most logical option to reduce carbon dioxide emission in fossil fuel reliant countries like Pakistan and India, which have 62% and 75% share of fossil fuel in their energy mix, respectively.

According to Global Carbon Budget 2022, annual CO2 emissions in Pakistan stood at 229.51 million tons in 2021, which was 9% higher than 210.38 million tons in 2020.

“Toyota has made an investment of $100 million to produce HEV vehicles in Pakistan and Toyota Corolla Cross, Pakistan’s first locally manufactured HEV SUV, is to be launched soon,” he highlighted.

It is expected the company would launch the Toyota Corolla Cross by the end of 2023 or early 2024.

Jamali said the adoption of hybrid technology will also result in the reduction of import bill, as 30 thousand units of HEVs will save around $37 million per annum.

Meanwhile, Jamali said despite registering a 55% reduction in production, the company has not laid off employees.

“The automobile sector of the country faces major challenges including weak demand, rapid price escalation, expensive auto financing, higher taxes, and deteriorating macros,” said Jamali.

He added that despite uncertainty regarding supply-side recovery, they have not opted for any layoffs.

He shared that the company faced a 58% decline in its volumetric sales from January to June 2023 alone.

First month of FY24: Car sales down 57% YoY as rising prices suppress demand

Jamali said that the local auto industry has been facing the issue of letters of credit for quite some time, making it difficult for the industry to meet its production targets, which in turn is badly affecting sales.

Besides, he added, the import of used cars is gaining momentum, severely impacting the already affected local auto industry, as total used car imports are more than the production of some OEMs (Original Equipment Manufacturers).

He added that more than 6,000 used cars were imported in the financial year 2022-23, with more than 1,800 units being imported only in May and June this year.

“In the presence of minimum foreign exchange reserves held by the State Bank of Pakistan, the government should refrain from permitting the policy of importing used cars and instead support the local auto industry, which is producing cars locally,” said Jamali.

He added that the industrial growth of the auto industry is essentially linked with a properly designed planned import policy and the growth of the local auto industry can never be achieved if import of used cars is freely allowed by the government.

“This issue of used car imports is also nullifying the plausible localisation achieved by the local auto industry, in terms of parts and also future localization plans,” he said.

Comments

200 characters
Khan Aug 30, 2023 08:28pm
i am sure the people who can afford this car have no issue in paying for high price fuel.
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Haq Aug 30, 2023 09:26pm
IMC quality & safety is extremely poor. Hybrid are too complex & mostly plastic / electronic components needs extensive replacements, with short life span. Assembling imported parts from Thailand will cost more than Rs 10 Million
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Mohsin Malik Aug 30, 2023 10:40pm
Since inception the big 3 have enjoyed special status. Neither they nor GOP is serious about localisation. As regards to exports to Egypt its carpet for fortuner which was produced by some vendor. They always target used car imports and then blame it for all their short coming. They will continue minting money and GOP a silent spectators as MOP is incapable and incompetent.
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Arif Aug 31, 2023 12:39am
When new car assemblers are afraid of used cars as competitors then there is something seriously wrong with your business model .
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Arshad Aug 31, 2023 10:42am
Let me guess, another Hyper expensive low quality car with miminum options is coming from Toyota ?
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Truthisbitter813 Aug 31, 2023 11:10am
@Mohsin Malik, The GOP is far from a silent spectator, beneath the surface all the big three find healthy political tie-ups. This is a colluded effort that has been on-going since decades long-past. Imported used cars are STILL the only economical option available to the middle class. And there is no bigger indictment of the "local-assembled" industry than this!
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