Dewan Farooque Motors is Resuming Vehicle Production in Pakistan

Dewan Farooque Motors is restarting its production by end of October 2016, according to an official announcement made to shareholders on Monday.

Dewan Farooque Motors will be manufacturing vehicles of different segments under toll manufacturing arrangement for which the installations of jigs and fixture are in the process for assembly plants.

The company also has entered into a toll manufacturing agreement with Daehan—Dewan Motor Company, which is a joint-venture between Yousaf Dewan Companies and KOLAO Group based in Lao PDR and South Korea.

With the rising demand of automobile in Pakistan coupled with offer for incentives and tax relaxation offer in the government’s automobile policy, reports of developments were received that the automobile maker was flexing its muscles for last couple of years, however it was formally disclosed in August 2016 that its management submitted a plan to resume productions in relevant authorities — Board of Investment (BoI) and the Engineering Development Board (EDB).

Besides offering incentives to new car makers to enter into Pakistan, the new auto policy, Auto Industry Development Program (AIDP II), gives an opportunity to sick automobile units for revivals which Dewan Farooque Motors is being witnessed tapping on.

Dewan Farooque partnered with Korean brands like Hyundai and Kia to produce its first car on January 15, 2000. The company received an extraordinary response especially for its Hyundai Santro and Hyundai Shahzore; a one-ton truck.

The company sales grew well until 2008, but it faced various challenges afterwards and currently the productions and sales are next to zero. After a gap of three years, Dewan Farooque Motors produced a few hundred cars in fiscal year 2014 and 2015 based on its old inventory.

The revival would likely to see the re-launch of Shehzore 1-Ton single rear wheel truck and Shehzore 1-Ton truck.

The company planned to launch passenger cars, light commercial vehicles and SUVs in collaboration with KIA Motors Korea in years to come.

Recently, Dewan Group on the behalf of Dewan Farooque Motor also finalized their agreement with SsangYong Motors Company, the fourth largest automobile manufacturer in South Korea. The company is underway negotiations with KIA Motors, which is a part of Hyundai Motor Group for local production of KIA range of vehicles in Pakistan.

Pakistan’s automobile production reached all-time high in the outgoing financial year 2015-16. With the introduction of passengers cars will likely to intensify competition among local players at domestic level.

The automobile company has been in the red for past many years with nearly Rs. 90 million losses by the end of third quarter, however, the group is likely to inject fresh investment in Dewan Faroque Motors Limited directly or through foreign investors or local investors.

  • Due to economics stability in Pakistan, now manufacturers and International companies are coming. I wish I could see Hyundai and KIA Cars and SUVs in Pakistan.

    • Well we also need to give credit to current government as its all because of the Recent Auto Policy (2016-2021).
      IA more to come

    • Economic stability nahi hai. Market opportunity hai. Understand it. Other countries has more than dozen automaker meanwhile Pakistani consumer have been looted by only 3 monopolists for decades. Don’t confuse economic stability. In real world progress = how happy people are living in any country.

      • How many people are happy living can never justify the real progress.
        People are never happy with whatever they have
        Market opportunity ab hi kyun hae ? Other 3 monopolist are here for decades
        Don’t confuse simple things.
        There are always economics factors and policy factors which attracts Foreign direct or local investment. Lowest interest rates than ever,better economic and policy making etc
        You need to study Auto Policy (2016-2021) and explore reasons why Deewan or others are coming up back

        • Mere bhai larte kiyon ho. Its a mix of economic opportunity and market conditions both. A potential investor would look at the market dynamic which is MONOPLY by big three and collusion.(by not competing with each other on price and quality rather division of market segments between players i.e. Suzuki in small vehicles and Toyota and Honda in sedans)
          The level of disposable income of the middle and upper middle class i.e. rising.
          and finally the size of the market which is not big but the indicators are positive with steady growth, low interest rates and rising domestic consumption and finally GDP growth and rise in Per capita income. Although I feel the GDP is not a good indicator for decision making as it doesn’t measure income distribution. The no. of sales should whcih is swelling should be good indicator.

          The good news is that the Govt. now targets to increase the current motorization rate (ratio of vehicles to 1000persons) which is 20 upwards, which is rock bottom compared to global average of 318. Substantial growth in motorization rate is not feasible with current market conditions.

  • I hope this would end the Monoply and Looting of So Called BigThree (Toyota-Honda-Suzuki) in Pakistan. also heard about the Volkswagen coming to Pakistan and Nissan also. Hoping for the best.

    • True. Santro is still one of the best 1000cc cars available out there as compare to suzuki crap

  • Excellent. Now we can afford (read MIMIC) Merc & BMW’s 3rd True copy cars like Optima & Sportage on Purestani roads Soon….
    Inshallah Inshallah *sings JJ & Sufi Salman’s awful collaboration devoutly*

  • Any news about JAC ? Someone told me that they are also coming soon in Pakistan as well as are also currently working on their Production plant at Gawadar

    • yeah … im still waiting for the Chinese..

      they have some real good cars out there for killer prices !

  • Paksuzuki and Toyota have obtained a stay order from Sindh High Court against the auto policy.
    Especially Paksuzuki is most reluctant to introduce safety features and new models.

    The Auto Policy is current suspended. The stay order must be canceled by the government else new assemblers wont come and we will be stuck with same obsolete cars.

  • Excellent. I’ve kia spectra.
    Awsome luxury car.
    Now I’ve choice a borrow new model of kia.
    I love kia scdenza


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