Indus Motor pulls the plug on Coure

Automobile assembler plans to launch another Daihatsu car.

KARACHI: After assembling Coure for 11 years, Indus Motor Company (IMC) last week pulled the plug on the only non-Suzuki car in the lower segment.

“We have shut down Daihatsu Coure’s assembly plant,” said IMC CEO Parvez Ghias, on the sidelines of a research launched at NED University on Monday. “Coure had lived its life. The product life cycle had come to an end.”

Coure started its journey in 2000 and around 75,000 units made it to the road, according to the country’s second largest assembler’s financial statements.

The 850cc car was always second as Toyota Corolla – the country’s largest selling car – was the primary product for Indus Motor. Corolla contributed almost 83% of total sales in 2011.

Coure was the only Daihatsu brand IMC, the second largest automobile assembler, was assembling in the country. However, it does market Daihatsu’s four-wheel drive Terios Kit imported from Japan.

Daihatsu’s new Coure sold in the European market with a totally redone shape was termed financially not viable for the Pakistani market by Ghais.

The car was available in four variants with the lowest variant Coure CX available for Rs868,200 while the most expensive Ecomatic for Rs938,000.  Coure was termed by industry analyst as a dying breed with sales falling 31% in its last stint during July to December 2011.

The exit of Coure and earlier Hyundai Santro makes Suzuki, with Cultus, Alto and Mehran, the only company in the 1000cc and lower segment.

IMC is in negotiations with Daihatsu to see if any other model could be launched in the country, Ghais said. Ghais admitted that Indus Motor should have started planning for a replacement three years back.

It takes years to create the auxiliary industrial base for a car that supplies parts like bumpers and seats, he said.

Indus Motor imported completely knocked down (CKD) parts bumper and seats before assembling it locally.

“The automobile industry was supposed to be making half a million cars  by now but we made just 160,000 last year,” said Ghias.

Import of used cars has surged intermittently in the last seven years as the government used the carrot-and-stick policy with the industry.

In fiscal year 2005-06 when duties were reduced, more than 46,425 used cars were imported and proved a huge dent for local assemblers.

Ghias said the government has to stop sending mixed signals to the industry. “We have to plan years in advance for introducing a new model. How can we do that when Planning Commission recommends that duty on imported cars must be reduced? “

The company’s profits almost doubled to Rs1.77 billion during July to December 2011 primarily due to higher sales and prices of its leading brand Toyota Corolla.

WITH ADDITIONAL REPORTING BY FARHAN ZAHEER

Published in The Express Tribune, April 3^rd, 2012.