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Pak Suzuki Urges Policy Shift to Boost Local Auto Parts

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Pak Suzuki Urges Policy Shift to Boost Local Auto Parts - Carr.pk

Pak Suzuki Motor Company Limited (PSMC) has called on the government to revamp Pakistan’s automotive policy to prioritise parts localisation, aiming to reduce reliance on imports and build a stronger local supply chain. The request was made during the SME Cluster Expo held in Lahore.

CEO Calls for Localisation Incentives

Speaking at the event, Pak Suzuki CEO Hiroshi Kawamura urged policymakers to introduce specific incentives in the new auto policy to support the local production of automotive components. He stressed that such measures would enable local vendors to meet global standards and expand their capabilities, helping Pakistan’s auto industry become more self-reliant.

Collaboration with Local Vendors

At the Expo, Pak Suzuki highlighted its ongoing efforts to integrate local vendors into its tier-1 and tier-2 supply chains. Kawamura also thanked the Small and Medium Enterprise Development Authority (SMEDA) for facilitating collaboration between industry players and SMEs.

Pandemic Lessons: COVID-19 and Import Dependency

The push for localisation has grown stronger since the COVID-19 pandemic, which severely disrupted global supply chains beginning in Q1 2019–20. Pakistani assemblers, including Pak Suzuki, faced critical delays in CKD kit imports, raising costs and production bottlenecks.

According to SMEDA Director Mashood Khan, this crisis highlighted the resilience of local businesses as during the COVID-19 pandemic, SMEs stepped forward, localised production, filled supply gaps, and ensured continuity with limited resources but unlimited commitment.

SMEs’ Role in the Economy

According to SMEDA Director Mashood Khan, SMEs in Pakistan employ nearly 25 million people and contribute around Rs2.8 billion in exports. He echoed Suzuki’s call for policy support, stating that enhancing parts localisation would have a direct economic impact and create more industrial jobs.

Policy Gaps and Industry Concerns

Pakistan’s current auto policy has focused heavily on attracting new entrants, offering them various incentives. However, existing manufacturers like Pak Suzuki argue that the policy does little to encourage localisation or strengthen the domestic parts industry.

The broader auto industry has also called for:

  • A dedicated auto parts manufacturing policy
  • Stricter regulations on used car imports
  • Time-bound localisation targets for existing and new OEMs
  • Reduced dependency on Completely Knocked Down (CKD) kits

Why This Matters

The push for parts localisation aligns with broader industry recommendations. Government and industry discussions have previously flagged the need for a separate auto parts manufacturing policy, stricter regulation on used car imports, and time-bound localisation targets to reduce dependency on imported Completely Knocked Down (CKD) kits and semi-finished components.

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