Affect of WTO on automobile industry of Pakistan

Abstract

Auto industry is one of the most important industries which are backbone of the economy of any country. This industry provides growth to many other industries such as steel, plastic, rubber, fuel etc. This industry is gaining more importance as vehicles are becoming a necessity. In the past, vehicle are considered a luxury but the development in technology and new ways of doing business have changed the status of vehicles. It is a capital intensive industry so the major companies of the world adopted the strategy of having a joint venture with the local companies to save their scarce financial resources and to gain access to the local marked. Pakistan Auto industry was developed in the late eighty's and start nineties when local investors made joint-ventures with the various Japanese companies who were advanced in technology and financially sound. Indus motor company, a joint-venture between Indus Group of companies and Toyota Automobiles Company, and Honda Atlas Company, a joint venture between Atlas group of companies and Honda Automobiles company, were the pioneers in the establishment of the local auto industry. Nissan Ghandhara motors had also started its operations but due to financial set-backs and ineffective marketing strategy, it was unable to continue the operations.