The United Arab Emirates (UAE) conglomerate, Al-Futtaim Group, is investing $230 million in the automobile sector of Pakistan through a joint venture with Renault.
Technologically beefed up, Al Futtaim-Renault cars will hit the roads in 2020 as Renault has already acquired 54 acres land in the country’s biggest industrial zone, Faisalabad Industrial Estate Development and Management Company (FIEDMC).
The Auto Development Policy (ADP) 2016-21 has proved to be quite lucrative for Pakistan, with as many as 12 car makers having invested $746 million so far. 2 companies have gotten Brown Field investment status, where a company purchases or leases an existing facility for a new production activity. 10 companies have been awarded Green Field investment status which allows them to initiate their operations in the local market from the ground up.
The investment bodes well for the Pakistani market which previously used to be monopolized and dominated by the Japanese carmakers Honda, Toyota and Suzuki for decades. The new auto policy has attracted several key foreign players in the auto arena.
The investment comes at a time when Pakistan is in dire need of foreign direct investment considering the crippling state of the economy and its falling forex reserves.
Ever since the announcement of the ADP, Pakistani market has gained the following new players which have shown their interest. The following investments have been made:
- Regal Automobile Industries with DFSK Motor – $10.71 million
- United Motors (Pvt) Limited with Yangste Motor Group and Luoyang Dahe New Energy Vehicle – $19.05 million
- Khalid Mushtaq Motors (Pvt) Ltd with Changan Kuayua Automobiles – $3.50 million
- Kia Motors with Kia Lucky Motors Pakistan Ltd – $190 million
- Hyundai Motors with Hyundai Nishat Motors (Pvt) Limited – $163million
- Changsha Foton Vehicle Technology with Foton JW Auto Park (Pvt) Ltd – $11.45 million
- BAIC International Development Company with Sazgar Engineering Works Ltd – $31.01 million
- Changan International Cooperation with Chongqing Changan Automobile, Master Motors Ltd and IVECO – $101.52 million
- Chongqing Lifan Automobile with Pak China Motors – $24.25 million
- Mianyang Huarui Automotive, T Dev Group, Chongqing Big S with Topsun Motors and Engineering Services – $5.43
- Ssang, Kia and Kolao Group with Dewan Farooq Motors – $145 million
- Nissan Motor Cooperation Japan with Ghandhara Nissan – $41.3 million
The entry of big players in the auto market is a sign of great improvement in the country’s auto sector. The next couple of years would see a number of new, advanced cars competing with the existing Japanese auto giants in Pakistan.
Via Pakistan Today