Unlocking Quotas for New Auto Companies

Jawad

30 Oct 2023

282

Unlocking Quotas for New Auto Companies

Asim Ayaz, the General Manager of Policy at Pakistan's Engineering Development Board (EDB), recently announced the opening of quotas for seven new auto companies in Pakistan. This development is significant as these quotas are based on agreements that take legal precedence over the Statutory Regulatory Orders (SROs) that govern the industry.

Upcoming Quotas

While new auto companies have already gained access to quotas, Ayaz also revealed that established auto companies will soon have similar opportunities, but with a time limit. This access will be available only until December. In this regard, Original Equipment Manufacturers (OEMs) and parts manufacturers are expected to collaborate on a comprehensive plan.

Symposium Insights

Ayaz made these announcements during a symposium titled 'The Future Drive: innovations, exports, trends, and the way forward for auto parts manufacturers.' The symposium took place as part of the Pakistan Auto Show, hosted at the Karachi Expo Center.

Certificate Non-Renewal

Ayaz shed light on the government's decision to not renew manufacturing certificates for car companies upon their expiration. This action was taken because these companies failed to meet the export targets that were mutually agreed upon with the government in 2021.

Auto Export Future

Ayaz pointed out that the government is open to incentivizing exports, emphasizing the importance of achieving export goals. New entrants were granted quotas based on an investment agreement signed in 2020, which took precedence over the 2021 SRO. However, he noted that the sector's deadline to meet its export target of 2% (of total imports) ended in June. Despite a three-month extension, the companies did not provide a concrete plan, leading to the government's reluctant decision to halt their shipments. Ayaz concluded by highlighting the looming necessity for new entrants to localize their operations, underscoring the importance of localization in the automotive industry.

Pakistan Auto Industry Engineering Development Board EDB Auto Company Quotas Statutory Regulatory Orders SROs Export Targets Investment Agreements Auto Parts Manufacturers Government Policies Automotive Sector Compliance Localizing Auto Operations

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