Indus Motor Company inaugurates its hybrid electric vehicle assembly line

ISLAMABAD: Indus Motor Company (IMC), a major player in Pakistan’s automotive industry, has finally inaugurated its assembly line for the production of what they are calling Pakistan’s first ‘Made in Pakistan’ Hybrid Electric Vehicle (HEV). The manufacturing facility, located in Karachi, is set to roll out the much-anticipated 4th generation Toyota Corolla Cross HEV after completing necessary tests and verifications.

As per information shared by the company on Wednesday, the landmark event, symbolizing a significant stride towards sustainable transportation, was commemorated at a private ceremony attended by key figures including Federal Secretary of the Ministry of Industries & Production, Asad Rehman Gilani; Toyota’s top leadership, including Mr. Yoshiyuki Takai and Mr. Yoshihisa Miyabe; and the Japanese Ambassador to Pakistan, Mitsuhiro Wada.

Why HEVs in Pakistan:

While the government has introduced incentives for both Electric Vehicles (EVs) and HEVs through the new auto policy, IMC emphasizes HEVs as a more viable option in the current landscape. A Toyota study supports this perspective, citing HEVs as a mid-term solution due to inadequate electric vehicle infrastructure and the country’s heavy reliance on fossil fuels for power generation. 

HEVs are expected to result in lower carbon emissions and a huge reduction in the oil import bill compared to traditional vehicles. While Toyota’s HEVs already have a strong foothold on the Pakistani auto market, all of these vehicles are imported completely built units (CBUs).

In alignment with the Automotive Industry Development and Export Plan (AIDEP) 2021-26, the policy aims to streamline the approval process for charging infrastructure, encouraging existing CNG and fuel stations to participate. Smart charging technologies, such as smart metering and time-of-use pricing, will be implemented to alleviate the main grid, especially for Level-2 and above charging stations. Initial promotions will focus on 2-3 wheelers, with major cities like Karachi, Lahore, Rawalpindi, Faisalabad, and Peshawar considered for EV introduction.

The Finance Act 2021 incentivizes hybrid technology, offering customs duty reductions on specific parts and a 1% customs duty on the import of hybrid buses/trucks. An 8.5% sales tax is applicable for both locally manufactured and imported hybrid cars, SUVs, Vans, and LCVs.

Toyota’s locally-produced-HEV story:

Many at IMC have made the mistake of calling Toyota Corolla Cross the first locally assembled HEV of Pakistan. However it is important to know that the title is proudly boasted by Sazgar’s Haval H6 HEV. The confusion perhaps arises from the delayed production, to a delayed launch of Toyota’s HEV.

The company first announced its plans for producing locally assembled HEVs in September 2021, when they announced a $100 million investment into this venture. It was later announced that their pilot vehicle is going to be the Crossover SUV, Corolla Cross.

Earlier this year, in June, while Shehbaz Shareef was still the Prime Minister of Pakistan, a team from Toyota including Toyota Asia’s president, met the Prime Minister, informing him about the launch of locally assembled Toyota Corolla Cross. 

However, a strict control over imports due to an impending forex reserves shortage and huge fiscal deficit, forced Toyota to announce the suspension of their HEV production within hours of that meeting. Since then the launch of a locally assembled Toyota Corolla Cross has been highly anticipated by the industry.

Event highlights – Quotes from key figures:

Mr. Mohamedali R. Habib, Chairman, IMC, expressed pride in achieving the ‘Make in Pakistan’ milestone, emphasizing the deep-rooted friendship between Japan and Pakistan. Mr. Yoshiyuki Takai, President ECC, TMC & EVP, TDEM, highlighted the increasing preference for HEVs in Asian countries and expressed hopes for a positive reception in Pakistan. Mr. Asad Rehman Gilani, Federal Secretary, Ministry of Industries & Production, congratulated IMC and emphasized the government’s commitment to supporting hybrid and electric technologies.

Mr. Ali Asghar Jamali, CEO, IMC, briefed about the investment of over $100 million which was made to manufacture the first Make in Pakistan HEV. He also apprised the attendees that Toyota Corolla Cross will showcase the highest-ever localized content in the SUV category in Pakistan. The 4th generation Corolla Cross HEV SUV features an 1800 cc engine with hybrid and gasoline drivetrain options.