LAHORE: Hyundai Nishat has introduced a limited time offer for prospective customers, whereby the company will reduce delivery times of cars to under one month of purchase.
Hyundai’s offer is a likely attempt to avoid July-esque sale figures and win over any customers it may have lost by its decision to not reduce prices like the majority of the automotive industry.
The company’s offer is a breath of fresh air for customers who have become accustomed to long wait times. The situation has been particularly bad this year, with the government having to urge the Ministry of Industry and Production (MoIP) to look into the matter.
Why Hyundai is providing this limited time offer? Partly to make up for the unusually long delivery times but it is also likely that the company wanted to capitalise on the same being afflicted on other companies. However, ongoing completely-knocked-down (CKD) kit restrictions placed by the State Bank of Pakistan (SBP) make rapid production of vehicles very difficult, if not impossible. There are two likely explanations for Hyundai’s offer, particularly its timing.
The first is that Hyundai may simply not have enough demand to begin with and the company has been able to forecast that the uptick in demand; whatever it may be, will be within the informal quota provided to them by the government.
The second is that the company replicated Lucky Motors method of building a buffer stock. Lucky Motors’ KIA brand of cars have, since inception, had minimal wait times due to the company deviating from the just-in-time (JIT) model practiced across the industry. It is this different production system that Profit speculated was the main reason for Lucky Motors choosing not to reduce the price of their vehicles.
Hyundai’s possible use of a buffer stock might have been an attempt to better utilise their newly expanded productive capacity and completely rid itself of the bottlenecks that plagued the company at inception. The company is likely to have built-up this buffer stock in June as the price increase came in July whereas low sales figures may have subsequently led to Hyundai holding onto the buffer stock longer than it originally planned for.
Hyundai has not provided a date for when this offer will end. Irrespective of the circumstances that led to the company introducing this offer, customers looking for new vehicles are likely to benefit.
Sďrr