Renault formally announces entry into Pakistan

Published: November 20, 2017
Email
The parties expect that the plant will be built starting the first quarter of 2018 in Karachi as per Groupe Renault standards. PHOTO: REUTERS

The parties expect that the plant will be built starting the first quarter of 2018 in Karachi as per Groupe Renault standards. PHOTO: REUTERS

KARACHI: Pakistan is set to see the entry of another major auto player with the announcement of Groupe Renault and Al-Futtaim that they have signed definitive agreements for the exclusive assembly and distribution of Renault vehicles in Pakistan.

Renault, which was earlier also involved in talks with Ghandhara Nissan, will now be in partnership with the UAE-based conglomerate, stated a press release issued on Monday.

“Groupe Renault is delighted to extend its international footprint by entering Pakistan, a fast-growing market with a 10% annual growth rate,” said Fabrice Cambolive, senior vice president, chairman of the Africa Middle-East India Region of the Groupe Renault.

“By partnering with Al-Futtaim, Groupe Renault aims to become a major player in Pakistan. We aim to bring our latest products and cutting-edge technology and set new benchmarks of safety and quality in the market.

The parties expect that the plant will be built starting the first quarter of 2018 in Karachi as per Groupe Renault standards, and car sales are planned to start in 2019, ramping up in 2020.

Meanwhile, the president of Al-Futtaim Automotive, Len Hunt said that Pakistan’s 200 million population, growing economy and “vibrant” middle class will make it an important strategic growth market.

The agreements will see Groupe Renault bring its latest products and technological know-how, while Al-Futtaim, through its new subsidiary Al-Futtaim Automotive Pakistan (Private) Limited, will establish a new manufacturing and assembly plant, and exclusively distribute Renault cars.

Al-Futtaim’s global automotive operations extend to 11 markets across the Middle East, Africa and South Asia, and Pakistan represents one of the most dynamic opportunities in these regions, in particular due to the new Automotive Development Policy.

The finalisation of the transaction remains subject to a number of conditions, mainly relating to relevant regulatory approvals from Pakistani authorities.

Auto sector set for revamp

The development follows that of Lucky Cement’s announcement of a joint venture with Kia Motors and Nishat Mills’ partnership with Hyundai Motor Company. Volkswagen is also reportedly setting up a plant in Karachi.

The announcements and plans of global carmakers come after years of Japanese domination in Pakistan’s auto sector that has resulted in capacity constraint issues for Suzuki, Indus Motor and Honda Atlas. Delivery times for new vehicles stretch as much as six months, and called for new entrants in the domestic market.

The announcement of the auto policy in 2016 has resulted in Pakistan attracting new players with its 200-million population proving to be a catalyst for foreign investment.

Facebook Conversations

Reader Comments (14)

  • Waseem Sarwar
    Nov 20, 2017 - 7:08PM

    Finally. Please bring cars within budget of Pakistani middle class and watch the brand grow within years. Recommend

  • Aman
    Nov 20, 2017 - 7:42PM

    Meanwhile, Renault Entered India in 2005.Recommend

  • sterry
    Nov 20, 2017 - 8:56PM

    @Aman: Who cares whether Renault or any other brand is in India? I certainly don’t. I think Indians should worry about their own country and let Pakistanis worry about their own country. We have different routes to progress and development based on our own culture and needs. I just hope that dharna culture does not scare away investment like Imran Khan did with his weeks long sit ins in Islamabad.Recommend

  • zoomzoom
    Nov 20, 2017 - 9:56PM

    Launch with Renault Zoe. Dhamaka Electric car.Recommend

  • Waleed
    Nov 20, 2017 - 10:11PM

    This is great that Renault is coming to Pakistan, but what concerns me is why a foreign company is getting the deal with Nissan? We have plenty of our own corporations, like Deewan Farooq, Engro, etc. that could have secured this deal. Would this be allowed to happen in the UAE or any of the Gulf countries? No. If these companies want to come to Pakistan, they should partner with a Pakistani firm to create high paying jobs, not just blue collar manufacturing employment. Recommend

  • Ahsan
    Nov 21, 2017 - 12:29AM

    Good news. All steps must be taken by government to facilitate new assemblers and expedite approvals. Competition will create better quality products for consumers and result in tens of thousands of new jobs.

    Any attempts from existing automakers to block new investment in the country must be dealt with strictly.Recommend

  • MJ-Sid
    Nov 21, 2017 - 4:27AM

    That’s great News for Auto Mechanics. Renaults have terrible reliability. Ever since they took over Nissan, even Nissan vehicles have been plagued with mechanical issues. Recommend

  • PakSal
    Nov 21, 2017 - 8:49AM

    @Aman:
    Mubarak ho aapko :)Recommend

  • Muhammad Waseem
    Nov 21, 2017 - 9:37AM

    Good for Auto SectorRecommend

  • Idol Breaker
    Nov 21, 2017 - 9:50AM

    Finally, some action!Recommend

  • Bunny Rabbit
    Nov 21, 2017 - 3:29PM

    another play toy of the rich . Recommend

  • fahim
    Nov 22, 2017 - 2:21PM

    @Bunny Rabbit:
    PAkistan is for all financial classesRecommend

  • aafat
    Nov 22, 2017 - 11:36PM

    @Aman:
    Er. .
    . Therefore what ….?Recommend

  • Tariq sharif
    Dec 5, 2017 - 9:41PM

    Great news for PakistaniRecommend

More in Business