More European Automobile Companies are Coming to Pakistan?

In this storm of price hikes, plants shut down, and booking suspensions, there is some good news from the Pakistani Automobile Industry. According to a report, 2 major European car companies are coming to Pakistan. The companies are none other than Volkswagen (VW) and Skoda. In Pakistan, their manufacturing plant is being established in collaboration with Premier Motors Limited (PML).

It is worth mentioning that Peugeot is the first European brand which is locally producing SUVs in Pakistan by collaborating with Lucky Motors.

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As per the report, Premier Motors Limited and Volkswagen Group will locally assemble the premium VW and Skoda cars in Pakistan. The manufacturing plant is being constructed in Balochistan. It will be established in 2024 with a capacity of producing 32,000 units per year. 

German Consul General, Dr. Rüdiger Lotz visited the site under construction and emphasized that Pakistan needs foreign investment to stabilize its economic situation. This project will not only help the country economically but also create new job opportunities. 

Volkswagen

Volkswagen also known as Volkswagen Group / Volkswagen AG / VW is one of the major German automobile companies headquartered in Wolfsburg. It was founded by the German government in 1937 for the mass production of low-priced cars also known as “people’s cars”. One of its most popular cars all over the world was the Beetle (production ended in 2019). 

Currently, the company produces a wide range of Sedans, SUVs, EVs, etc. Some of its popular models include Arteon, ID.4, Atlas, Tiguan, Taos, Jetta, etc.

Skoda

Skoda, one of the oldest car manufacturers, was established in 1859 under the name Laurin & Klemen. The company first started making bicycles and then moved on to motorcycles later on. By 1905, Skoda was manufacturing cars as well. Although Skoda is based in the Czech Republic, it joined Volkswagen in 1991. Volkswagen took 70% of Skoda’s shares by 1995. 

Currently, it manufactures a wide range of vehicles including Sedans, SUVs, EVs, Hybrids, etc. Some of its popular models are, Enyaq iV, Octavia iV, Fabia, Superb, etc.

Conclusion

It is welcoming news that more European automobile companies are entering Pakistan which will create an environment of healthy competition. But, the companies which are already operating here are struggling (in terms of sales) due to the economic crisis. Let’s see how the new entrants operate here and find success. 

We always say that companies should not just focus on assembling the cars here but localize their production. In this way, the prices of cars may come down and the issues like the non-opening of Letter of Credit will not impact their production majorly as they will be less dependent on import of most raw materials. As a result, their supply chain and operations may not be much affected due to the Dollar shortage or import restrictions in the country.

What are your thoughts on this news? Tell us in the comment section below.

Photos Credits: vw.com, skoda-auto.com