Lucky Motors Ltd (LML) and France’s Groupe PSA have inked an expression of interest (EOI) and a memorandum of understanding (MoU).
LML, under the terms of the agreements, will assemble, manufacture, market, distribute and sell PSA automobiles and light commercial vehicles in the country; they plan on producing PSA models at their manufacturing plant at Bin Qasim Industrial Park.
Groupe PSA is a French transnational producer of automobiles and motorcycles sold under numerous brands including Peugeot, Citroën, DS, Opel and Vauxhall, PSA’s largest brand in Europe is Peugeot.
LML falls under the Younus Brothers Group and is also in the process of introducing South Korea’s KIA brand in the country.
Asif Rizvi, CEO LML, while talking to the media said that the partnership with Groupe PSA will bring a radical change in the country with the introduction of locally made European cars. He said,
We have applied to the Board of Investment (BoI) for category A greenfield investment status under the Auto Development Policy (ADP) 2016-21.
Parts of the agreement with PSA are to be carried out within the next few months, he added.
The CEO explained,
Initially, we have decided to assemble Peugeot cars which will be the first European car to arrive in the CKD category in the country. The new project involves an investment of about $15 million in jigs and fixtures and facility since the LML plant will be used for assembly of the European cars.
Future success of Pakistan’s automobile sector, according to the CEO, requires cars by numerous brands under various auto groups, “Which we are laying the foundation for”, he said, “This would give consumers an even wider range of options, through low volume production, besides intensifying competition among the existing and new players”.
This agreement is a timely welcome keeping in mind the doubts around the $165 million Al Futtaim-Renault project.
Over $1.3 billion under the ADP 2016-2021 has been invested by foreign investors, whose projects are at various stages of completion.