Daily Times

KARACHI: Auto sector in Pakistan has been seeing an extraordinary level of developments lately as following the French carmaker Renault and South Korean carmaker KIA, another Korean auto giant Hyundai Motor Co is ready to set up a car assembly plant in Pakistan.

It seems that the automotive development policy 2016-21 turned out to be fruitful as it is creating healthy competition which will lead to substantial benefits accruing to the end consumers.

Hyundai Motor Company will set up a car assembly plant in Pakistan in a joint venture with Mian Mansha’s textile firm Nishat Mills, according to a statement sent to Pakistan Stock Exchange (PSX) by Nishat Mills Limited.

Hyundai and KIA were engaged in car assembling in Pakistan in the 1990s and early 2000s with collaboration of local partners Dewan Farooque Motors Limited (DFML).However, both Korean automakers suspended production in 2004 due to the bankruptcy of DFML.

KIA Motors’ Pride and the Sportage in Pakistan were much popular whereas Hyundai’s Santro gave strong competition to all three Japanese car assemblers. In December 2016 another Korean car maker, KIA announced to collaborate with Karachi-listed Lucky Cement to manufacture and assemble cars in Pakistan

“The Board of Directors of Nishat Mills Limited has resolved to enter into a Memorandum of Understanding (MOU) with Hyundai Motor Company, Seoul, South Korea and Sojitz Corporation Tokyo, Japan for negotiating and establishing a framework for setting up a green field project for assembly and sales of Hyundai Motor Company passenger and one tone range commercial vehicles in Pakistan”, Nishat Mills company secretary Khalid Chauhan said.

However the deal is subjected to applicable statutory and regulatory approvals, he added. The share price of NML noticed an upward trend with the share price increasing by Rs 4.77, a 2.79 percent increase on Friday.

It is important to mention here that Hyundai has strong presence in neighboring country India. The company operates with the name of Hyundai Motor India Limited (HMIL) and it is the largest passenger car exporter and the second largest car manufacturer in India.

In India, it currently has ten car models across segments – Eon, i10, Grand i10, Elite i20, Active i20, Xcent, Verna, Creta, Elantra, Tucson and Santa Fe. HMIL forms a critical part of HMC’s global export hub. It currently exports to around 87 countries across Africa, Middle East, Latin America, Australia and the Asia Pacific. HMIL has been India’s number one exporter for the last 10 years consecutively.