Pak-China automobile JV creates more economic activities

By Mariam Raheem | Gwadar Pro Mar 10, 2022

LAHORE, Mar 10, (Gwadar Pro)-MG Motors Pakistan, a joint venture between JW-SEZ Group and SAIC Motor, is building a 260,000-square-meter manufacturing plant in Lahore’s Special Economic Zone, which is expected to be officially opened in August this year.

Lahore’s current production line, which produces 100 vehicles per day, is ready for export once it is approved by the government while meeting local demand.

Shah Faisal Afridi, Chairman of JW SEZ Group told Gwadar Pro in a recent interview that, “Pakistan has a large population and is a market with huge potential. It has a high recognition of Chinese brands, and SAIC brands are very popular.” Full of confidence in Chinese brands, Faisal expects MG’s orders to grow further in the coming years, “at present, all the parts and components are from China, and with the commissioning of the new factory, we will introduce parts suppliers to cooperate with us to invest in Pakistan. In the near future, we will also target customers in the Middle East and other countries.”

Zhang Jianmin, CEO of the JV company, believes that the profound friendship between Pakistan and China has provided a security guarantee for investment. “Although the COVID-19 pandemic has had some impact on the project, through management, there will be no delay in putting it into production.” The CEO added, “the local team is very strong, and the local labor cost has a great advantage. When we implement the two-shift system, it is estimated that about 500 additional jobs will be created. At the beginning, we will have about 50 experts from SAIC to conduct on-site training. In the long run, we plan to set up our own technical school to train our staff, and every local staff should receive minimum pre-service training before starting work.”

As a comprehensive product of industry, the automobile will bring great industrial progress to Pakistan. The Pak-China automobile JV will produce high-quality vehicles that meet international safety standards. In addition, the price-competitive MG brand will accelerate the iteration of products in the Pakistani automobile market. This will change the way Pakistanis think about vehicles, and it is a groundbreaking change in Pakistan.

In recent years, several Chinese automobile makers have or will set up JVs in Pakistan in collaboration with their local partner companies. One main reason is the government offered tax incentives to new automakers in the ADP policy, the other is the close Sino-Pak relationship is strengthened by the multi-billion-dollar CPEC initiative. The Free trade agreement between both countries will flourish economic development.

Just like the initial stage of China’s automobile industry, after decades of cooperation and innovation, China’s automobile industry has gradually stepped onto the world stage, and the Pak-China automobile JVs will be further deepened. From JVs in automobile production to JVs in the production of spare parts, and then to automobile-related industries such as iron and steel and chemical industry, there is huge room for cooperation between the two sides. “It is our responsibility and obligation to keep up with the international trend and promote the development of Pakistan’s automobile industry,” Faisal concluded.

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