BYD: Will ‘Tesla Killer’ be able to introduce affordable electric vehicles in Pakistan?2024

BYD (Build Your Dreams), China’s largest electric car company, has shown new dreams to car enthusiasts in the country, especially electric vehicles, by giving an indication of investment in Pakistan.

In Pakistan, while the prices of cars are skyrocketing, on the other hand, car sales are experiencing a record decline.

The difficulties faced by the auto industry can only be gauged from the fact that less than 50,000 new vehicles were sold in the last eight months in a country with a population of 240 million. A large reduction appears.

So the question is why did BYD talk about investing in Pakistan in these circumstances and will this Chinese company’s entry into the country enable access to affordable electric vehicles?

“BYOD’s interest in investing in Pakistan”

According to Special Investment Facilitation Council (SIFC) of Pakistan, BYD has expressed interest to invest in Pakistan.

According to an official statement, this move comes at a time when Pakistan is striving to reduce its carbon footprint and adopt environment-friendly measures.

It said that ‘this initiative will make green products more accessible to Pakistani consumers as well as take Pakistan’s auto industry on the path of development.’

BYD will manufacture its electric vehicles locally in Pakistan, which will enable the country to export right-hand drive vehicles.

In fact, an agreement was signed between BYD and the Pakistani company Mega Conglomerate during the company’s Asia-Pacific dealer conference in Xi’an, China, late last month.

According to its press release, BYD will introduce electric cars in Pakistan with a local partner.

electric vehicles
electric vehicles

Mega Executive Director Ali Khan has said that BYD showrooms will be opened in Karachi, Lahore and Islamabad during 2024 where consumers will be able to buy the company’s products directly.

Although in a joint statement the two companies have announced their entry into the passenger vehicle market in Pakistan, it is not yet clear which of BYD’s electric cars are being introduced and how much will be invested in the country. Will be done.

When the BBC reached out to the mega-conglomerate via email, they said the information was being kept confidential for now and would be shared with the public at a later stage.

Could be a good deal for Pakistan.

Lahore University of Management Sciences (LUMS) professor Naveed Arshad has a keen eye on the automotive industry in Pakistan, especially electric vehicles.

He points out that BYD is one of the largest electric vehicle companies in China and around the world, and it would not be wrong to say that they have a kind of monopoly in the market, especially in electric buses. Be it in America, South America or Europe.

In his opinion, a company that has advanced battery technology would be welcome to invest in Pakistan. “BYD has been able to sell vehicles at low prices that are not possible for other companies.”

Naveed Arshad points out that some of BYD’s electric cars are quite popular outside China as well. “It remains to be seen whether BYD will come to Pakistan as a dealer or start assembly here as well, which will be a bigger development.”

Meanwhile, auto sector expert and parts manufacturer Mashhood Ali Khan says that BYD coming to Pakistan is apparently a very good deal.

He says that whenever an international car company intends to invest in Pakistan, its cars are first tested here.

During the last quarter of 2023, BYD sold more electric vehicles worldwide than Elon Musk’s company Tesla. is one of the EV companies.

Sources say that this potential investment will initially see the company importing CBUs (i.e. complete vehicles) into Pakistan and may go ahead with an assembly plan.

In his opinion, this project can be successful only if it is long-term, establishing a vehicle assembly plant in the country, as the market for electric vehicles in Pakistan is currently not that big.

Mashhood says that all the electric vehicles that have come in Pakistan so far are CBUs and no infrastructure has been established at the local level to build a battery system or charging unit. “BYD will face these challenges, but it has a strong infrastructure in China where it builds batteries, assemblies, parts and vehicles all by itself. In Pakistan he has to bring the same resources.

Will BYD be able to bring affordable electric cars to Pakistan?

So will China’s largest electric car company, BYD, be able to introduce cheap electric vehicles in Pakistan? Professor Naveed Arshad said that a good electric car can be sold for at least 25 thousand dollars, which is about 7 million Pakistani rupees. Is.

At present, the price of BYD’s small electric car ‘Seagull’ in China is 10,000 US dollars i.e. about 3 million rupees. The company is also known for its SUVs all over the world and recently has a plant under construction in Brazil.

However, according to Naveed Arshad, initially BYD cars in Pakistan will not be so cheap, but they definitely have such technology that they can make small cars with small batteries. “If we say they beat the (Rs 30 lakh) Alto, it’s not possible right now, it might take years.”

He believes that BYD will currently enter the mid- or high-end market in Pakistan with better margins.

Auto industry expert Mashhood also believes that there is a strong possibility that BYD will also target the luxury segment and introduce its sedan or SUV cars in Pakistan. Pakistan is a developing country, electric cars have been successful in more developed countries. Many challenges can be faced here.

So far, there is a lack of charging infrastructure for electric vehicles in the country, due to which consumers who buy EVs often shy away from taking it for daily use or to other cities.

According to Naveed Arshad, the introduction of electric cars and charging infrastructure is a ‘chicken and egg problem’. One has to take a bitter sip.

He said that Pakistan currently has 50% surplus energy so the energy sector should invest in charging infrastructure which can benefit in the future.

Naveed Arshad says that if a Chinese electric car company comes without planning and does not take charge of the charging infrastructure, their customers will be the luxury segment who have their own home and solar charging connection and BYD is their second or third car. There will be a car.

He says that after the increase in the prices of conventional vehicles in the country, SUVs which are available at a slightly lower price have become popular and these cars also have a higher margin for the companies. He believes that BYD can also target the same price segment.

Before BYD, electric vehicles from MG, Hyundai and Ceres have been introduced locally in the country and it is likely that BYD, known globally for its low prices, will compete with these companies.

Meanwhile, Mashhood says long-term planning is important for any new company and it remains to be seen if the Chinese company uses Pakistan as a hub for left-hand drive exports. “This can create job opportunities for blue-collar workers.”

In his opinion, this could also create opportunities for domestic exports in the car industry as no car company here has the capacity to export vehicles.

When we asked Naveed Arshad whether BYD right-hand vehicles can be exported from Pakistan in the future, his answer was that this market is only in India, Sri Lanka, Bangladesh, Nepal or African countries, but this is questionable. The mark will be if we can export there.

“Instead of exporting, if we make and sell these cars here only, it will be useful as a substitute for imports.” Electric vehicles consume less energy and this will reduce the fuel import bill, but it will also require other components.

 

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