The Pakistan Economy Watch (PEW) on Sunday said that natural disasters in Japan have proved fateful for Pakistan's auto industry which continues to rely heavily on imported components. Car manufacturers should plan transfer of technology, revisit import strategies and engage multiple suppliers located in different countries to avoid such situation in future, said Dr Murtaza Mughal, President of PEW.
Unable to tackle shortage of parts and keep production, Pakistan's carmakers are facing serious problems and heavy losses, he said. Over 1,000 original equipment manufacturers, auto vendors, high tech engine parts producers and transmission parts fabricators in Japan have experienced adverse impact of disaster which would translate into overall loss of around 20 billion rupees to local auto manufacturers, according to an estimate.
The situation demands that the local industry should learn the importance of better planning and distributed operations, said Murtaza. Automakers can no more afford the luxury to avoid the trend towards localism in manufacturing, he added.
Automakers should promote localisation to reduce dependence on imports and seek alternative sources for critical parts that are not available locally, he advised. Local auto assemblers should learn to adapt, ensure transfer their knowledge, expertise and latest methodologies to remain competitive, which cannot be without pains, he said.
He said that any problem with a foreign contractor needs weeks and month to arrive at a solution, while such an issue needs few hours to settle if the service provider is based locally.
Productivity, capacity utilisation, management techniques, costs, skill upgradation, training, transparency and quality are some issues that need to be resolved urgently, he said.
Private sector industries should set up their own vocational institutes to prepare highly skilled workers, he opined. If Pakistani technicians can produce parts for Boeing, why cannot they do it for cars? he asked, adding that the only lacking element is proper patronage.