Another Potential Market
Kia Motors Co. are re-entering the Pakistan’s car market, the potential market with a population of about 200 million people. As European automakers, including Renault, are scrambling to push into the market, the South Korean carmaker is also making an aggressive movement again.
According to industry sources on December 9, Kia Motors will start assembling its vehicles in Pakistan soon with its local partner, Yunus Brothers (YB) Group, the parent company of Lucky Cement. The company is re-entering the Pakistani market in 10 years after the halt in manufacturing in the nation. To this end, YB Group plans to initially inject US$120 million (140.76 billion won), though the total amount of investment hasn’t revealed yet. YB Group also joined hands with Korea Southern Power Co., Hyundai Engineering Co. and Hyundai Corporation to construct a wind power plant complex in Pakistan in 2011.
In 1999, Kia Motors assembled the Pride and the Sportage in Pakistan. At that time, the company started assembling the cars in the nation after signing an agreement with Dewan Farooque Motors Limited (DFML) to assemble 10,000 units a year. However, it withdrew from the market in 2004 due to the bankruptcy of DFML. In 2000, Hyundai Motor Co. also joined hands with DFML, the technical support partner firm in Pakistan, to export its products using the knock-down (KD) method, but it halted the sale now.
Kia Motors is pushing into the Pakistani market again owing to its growth potential. Pakistan is considered one of the countries with high growth potential like India. In a bid to target the Pakistani market, French carmaker Renault will complete the construction of a new factory in Gandhara, Pakistan, by 2018 and start mass production.