In what seems like to the bargaining stage of dealing with grief, Suzuki has stated that it will invest up to $460 million in Pakistan if the auto-policy is modified.
Back in March this year, the long expected auto policy was finally announced much to the displeasure of current players in the market since it favors new entrants. Among the advantages for the likes of Audi and others are lower duties. According to Pakistan Suzuki Motor Company, which assembles Suzuki cars for the local market:
The new auto policy will damage the tremendous investment potential in the Pakistan automobile sector by existing players such as Pak Suzuki Motor Co
This sentiment is nothing new and we’ve already covered the strong opposition to the policy by current players in the market. Pakistan Suzuki further added:
If the incentives and benefits should be given then we are ready for $460m investment in Pakistan.
With the new investment, Suzuki proposes building a modern plant on an accelerated schedule. They’ve committed to introducing 4 new car models from this plant within 5 years of its establishment with 2 models being released by 2018.
Right now, the government is rightly angry about the lack of competition, choice and innovation in the Pakistani automobile sector. This could go some way to assuaging that anger.
One of the motivations behind a new entrant friendly auto-policy is the fact that local market heavily favors Japanese vehicles since locally assembled cars are being sold at high prices with lesser perceived feature sets and value.
According to Pakistan Today, the Japanese manufacturers operating in the country are also displeased with the auto policy, citing a lack of incentive for them to invest in Pakistan.
via Pakistan Today