Responding to the growing demand of passenger vehicles in Pakistan, German automaker Volkswagen has announced the launch of two new vehicles. The company, Volkswagen Commercial Vehicles, has collaborated with Premier System Pakistan Limited to establish a manufacturing/assembly plant in Karachi. This plant will assemble the company’s Amarok and T6 transporter vehicles.
Volkswagen’s Amarok is a transporter truck while the T6 serves the purpose of a passenger van. These two vehicles have been chosen based on higher expected demand resulting due to the ongoing CPEC projects in Pakistan. Apparently, Amarok will be giving direct competition to Toyota’s Revo while T6 will provide a good replacement for other passenger vans.
According to an official:
“Volkswagen believes that such robust vehicles are a must in Pakistan. There will be a large dealer development and the target is to have 40 dealerships across the country”
Volkswagen Plans to Use Audi’s Plant
Audi AG, a renowned German car manufacturer showed an intent to enter Pakistan in November last year by setting up a plant in Korangi Industrial Area, Karachi. Volkswagen, which owns the Audi AG Company, plans to use the same plant for manufacturing/assembling its two new models. Currently, Volkswagen will only initiate with its transporter vehicles but it can also start making its passenger car range in the near future.
Their Pakistani counterpart, Premier Systems will manage arrangements in Pakistan. As a result, both auto giants could smoothly enter the new market.
Also Read: China keen to setup automobile manufacturing unit in Pakistan
Test drives will be conducted on Pakistani roads, which is a standard practice before any new model is launched. These test vehicles will be driven by German drivers who will provide their feedback once they go back to Germany and suggest changes if required.
Volkswagen made this decision on the news that high quality diesel will be available in Pakistan starting this year. It is pertinent to mention that heavy vehicles cannot run on other types of fuel. Currently high quality diesel is being imported by oil marketing companies, but Pakistani refineries have decided to produce this product which is a necessity for meeting emission standards set for heavy engines.
Higher Foreign Direct Investments… An Encouraging Sign
Laggard export growth, rising trade and current account deficits and depreciating currency have been just a few issues Pakistan’s economy is struggling with. Under such circumstances, an influx of foreign direct investment is indeed an encouraging sign for the economy. Economic analysts believe that foreign investments will surely reduce the current economic hurdles and bolster growth. As per reports, establishment of Audi manufacturing plant would bring an investment of $30 million in Pakistan. Additionally, the numbers could go higher if Volkswagen decides to set up its own plant.
Auto Sector Is In The Limelight
Apart from the two auto giants venturing into Pakistan, there are reports of many local companies to join hands with auto manufacturers. Nishat Textile Mills has entered in an agreement with Hyundai to assemble cars in Pakistan. Furthermore, a renowned player in the cement industry, Lucky Cement has sealed a deal with Kia Motors. Moreover, Gandhara has also found its auto mate ‘Renault’ for using its plant for assembling cars locally.
Apparently, the competition in the auto market would rise tremendously, as veteran player like Pak Suzuki might also bring additional investment in its business.
Leave a Reply
This site uses Akismet to reduce spam. Learn how your comment data is processed.
