Electric vehicles: companies are seemingly testing the market, but is Pakistan ready?

As fuel prices add to the cost of living and doing business, Pakistan is seeing a greater number of electric vehicle manufacturers announcing plans to enter the market. However, barring one player, others are seemingly testing the waters before they decide to initiate manufacturing in Pakistan, choosing, instead, to sell Completely Built Units (CBUs) as the country becomes ready for EVs.

While there are around 3 dozen licences issued for two- and three-wheelers, Pakistan’s Engineering Development Board (EDB) has yet to issue a licence to a manufacturer of a four-wheel electric vehicle.

Only one player – Dewan Farooque Motors – has applied for the licence and its manufacturing certificate is in the stage of “finalisation”, an official at the EDB told Business Recorder.

Chinese giant BYD partners with HUBCO subsidiary to introduce EVs in Pakistan

An official at DFML confirmed that it has applied for the licence ahead of its plan to launch EVs in Pakistan.

“Over 500 EVs have been booked and the company will start delivering them in September this year,” the official, who requested not to be named, told Business Recorder.

DFML entered into a manufacturing agreement with ECO-Green Motors Limited (EGML) for manufacturing EGML’s Honri-VE, and announced this development at the end of May this year.

Back then, it stated that production is expected to commence in August.

In July, DFML informed stakeholders regarding the progress made at its assembly plant for the manufacturing of EVs.

The company’s Honri-VE 2.0 and 3.0 are priced at Rs4 million and Rs5million with a range of 200Km and 300Km, respectively.

DFML’s plans also come in tandem with Chinese automotive giant BYD that is poised to make its official entry into the Pakistani market, with a brand launch scheduled for August 17. However, the company has yet to apply for a manufacturing licence for CKD assembling. Similarly, Audi Pakistan as well as BMW have sold CBUs, but their price points are in the premium category.

“They don’t have a facility to manufacture or assembly in the country yet,” said the EDB official, referring to BYD.

However, a company can commercially import and does not require any permission from the EDB.

The official conveyed that an existing manufacturer can commence production of EVs at its plant, but with a fresh approval after verification of additional machinery.

Facing runaway inflation, households in Pakistan have increasingly been looking at alternatives to lessen the burden.

Solar energy adoption is already on the rise, and a transition to electric is also being pushed with the entry of different companies.

However, lack of charging infrastructure, power tariffs, price points of different vehicles, and a general unwillingness to adopt a new technology will play on the minds of both companies and consumers.

In an earlier interview with Business Recorder, Dr Aazir Anwar Khan, founder and director Integrated Engineering Centre of Excellence (IECE) at the University of Lahore, had emphasised the importance of EV companies offering affordable price points to encourage widespread adoption.

He explained that importing EVs in completely built-up units (CBU) form incurred around 35% duties and taxes, while in completely knocked down (CKD) form, the costs amounted to just 5%.

This presents an opportunity to offer inexpensive EVs to the Pakistani market by companies that have assembly plants.

Dr Aazir stressed that making EVs more accessible was crucial for achieving desired outcomes such as reducing fuel consumption, lowering fuel import bills, and cutting carbon emissions.

A company with a manufacturing facility and license shows its intent that it has entered Pakistan for a long haul.