This document analyzes the automobile industry in Pakistan. It provides an overview of the history and development of the industry since the first automobile plant was established in 1949. It discusses the key players and market structure. A PESTEL analysis identifies important political, economic, social and technological drivers affecting the industry. Porter's Five Forces model is applied to examine competitive rivalry, threat of new entrants, power of suppliers and buyers, and substitute products. The industry life cycle places the industry in the growth phase. The conclusion recommends increasing competition through lower import tariffs to improve quality, technology and affordability for consumers.

1. Automobile
Industry Analysis

2. TEAM
MOHSIN ABBAS
Marketing Specialist having
practical experience in
business field. Motivated and
focused personality with great
knowledge of Information
Technology & interesting
player of Football.
MUHAMMAD WAQAS
Human Resource specialist
with great passion, self
motivated, having good
expertise in biography writing
and focused player of PUBG.
SHAMSHER ELAHI
Marketing Expert with great
knowledge of content writing
having intense loyalty towards
Football.
SHAFIQUR REHMAN
Finance Specialist having
moderate analytical quality
with a great passion for poetry.

3. Table of Contents
 Introduction
 PESTEL (Key Drivers)
 Scenario Building
 Porter’s Five Forces
 Industry Life Cycle
 Conclusion

4. Introduction
An industry that produces automobiles and
other gasoline powered vehicles, such as
buses, trucks, and motorcycles.

5. Cont’d
 Started in Pakistan when the first automobile plant was set up in May 1949 by General Motor &
Sales Co
 According to Ministry of Industries, Pakistan produced its first vehicle in 1953, at the National
Motors Limited
 Manufacturers from the US collaborated with Pakistani businessmen to set up; Ali Automobiles
to manufacture Ford Products in 1955
 The end of the seventies all automobile assembly in Pakistan stopped, until 1983 when Pak
Suzuki started manufacturing their vehicles in Pakistan.

6. Cont’d.
 Further Toyota Indus Motors was set up in 1990, followed by Honda
 The industry is highly regulated in 1990s
 The industry contributes 4% to country’s GDP
 The sector as a whole provides 3.5 million job opportunities
 Manufacturing plants across the country 3,200
Industry Structure
The auto industry is considered to be an oligopoly
Automotive producers and commercial vehicle producers
Major Assemblies
 Toyota, Indus Motors, Pakistan Suzuki, Honda Atlas & Diwan Farooq Ltd

7. PESTEL (Key Drivers)
Political Factors Economical Factors
• Government ruled restrictions on the number
of parts to be imported (to encourage local
producers)
• Rise in inflation car manufacturers to increase
their prices
• It needs to produced international standard
compliant product by local producers (by
means to expand the market)
• Interest Rate also affects car prices
• Sales and custom taxes • Fluctuations of exchange rates & oil prices
(people can’t afford)
• Investors are not willing to invest in such a
country which is not politically stable

8. Scenarios
Worst Situation ?
? Best Situation
High
High
Low
Low
Taxes
(Political)
ExchangeRate
(Economic)

9. Potter five forces
Threat of potential entrants
 Price wars
 intense competition
 Barriers to entry (Large scale investment, Expected retaliation )
Power of suppliers (moderate)
 Large number of suppliers(but we are importing most of the parts like steel and
glasses)
 Threat of forward integration is less

10. Power of buyer(high)
Power of substitute
 substitute of this sectors are plane, railways ships, public transport (like careem
and uber so the threat is high specially from public transport)
Competitive rivalry
 It is very high in this sector because of competitor balance ,industry growth, high
fix cost, high exit barriers

11. Complimentary goods
 Gasoline (prices of petrol cng etc)
 Insurance (need to insure your car, not applicable in Pakistan)
 Infrastructure(roads ,bridges etc)
 Public transport system(if affiant it can effect the demand)

12. Life Cycle

13. Growth Rate

14. Conclusion
 Auto assemblers are charging very high prices
 With just a small number of manufacturers, Pakistan’s Auto Industry cannot become
competitive
 Competition in the automobile market could be improved significantly by allowing import of
new cars at lower prices
 The benefits of lowering tariffs on new cars will be many
 It will make available greater options for the consumers
 Increasing inter-brand competition
 Introduce new technology to Pakistan
 Improve safety standards
 It will force the local manufacturers to compete in the market,
 Improving quality and decreasing price