Pakistan is a country with one of the toughest terrains in the world; the beautiful rocky mountains of Northern areas and the rough routes of Baluchistan, the province that comprises around 40% land of Pakistan, requires a powerful vehicle for traveling a vehicle that shows tremendous potential of 4/4 vehicles in that region, which should be capable of moving on the most roughest and difficult places. Moreover even in cities like Islamabad,Lahore and Karachi, there are people who have a passion for cars capable of fast speed that also prove a smooth drive over the roughest terrain. Land Rover is a brand known for its capability to drive on the roughest and toughest trails, making it the best SUVs in the world. Land Rover’s advanced engineering and superior driving technology has created a sophisticated off-road as well as on-road vehicle with refined and precise handling for both everyday driving and long-distance journeys.
Col ® Zafar uddin Ahmed, a mechanical engineer and a retired Army officer, had a passion for living an adventurous life which led him to his new career after retirement. Before his retirement, he also worked in “502 workshop” as a mechanical engineer for 4 years. From a logistics point of view, he thought thatPakistandid not have 4/4 vehicles, neither did the Army. So, combining his passion with a keen business acumen, he found great potential in the business of SUVs inPakistan. Hence started his career in the automobile sector, where he has proved a visionary with very clear objectives.
Committed to his new career path, he selected Land Rover because he thought that this was the vehicle which could work in all the terrains that prove hard inPakistan– rocky, mountainous and desert areas. It was a challenge for a person who did not have a background or experience in the automobile sector. To convince Land Rover to enterPakistanand start assembling here was another huge challenge in itself. With his vision of “Unless you accept challenges, you can’t achieve anything in life”, he went forth to start selling a western car in a market which was predominantly captured by Japanese assemblers. Before that, there were many attempts of selling a western vehicle inPakistanbut unfortunately they all failed. However, where others failed, Mr. Zafar succeeded in setting up Sigma Motors, acquiring the license for Land Rovers, and setting up sales outlets.
Explaining the difficulties and challenges he faces in making Land Rover a choice car in Pakistan, Mr. Zafar said that patience is the key to succeed. Everything takes time. When we hire employees, we tell them in the start that if you want to do an easy job, you can join some other giant corporation, because if you move with the current you’ll keep going but the best fish is that which accepts challenges and flows in the opposite direction. It is difficult and risky, but as we all know the higher the risk, the higher the return.
Beginning of Sigma Motors
Sigma Motors started operations in 1994 and Land Rover is the vehicle of choice for the Pakistan Army. Mr. Zafar started the business by providing the vehicle to the Army because he had to work with the phsycy of the people. He planned to penetrate the Army which was easy for him because of his contacts in the Army, and as Army is spread all over the country, people get accustomed to the vehicle, also since Army is trusted all over Pakistan, people tend to follow the same trends as are set by the Army of Pakistan.
Sigma motors have outlets in Islamabad, Lahore and Karachi, covering all the 4 provinces. Some people want this vehicle just for dominance on the road and some want it because of its high off-road performance. In our tough terrains, we need a very steady vehicle which is capable of real 4/4 qualities. Other brands that are competing with Land Rover have an edge that they are well established in Pakistan, having captured the minds of the customers and high resale values; but Land Rover has an edge from the technical point of view. “If you buy a Land Rover, even your grand children will drive it; this I can assure you”, says Mr. Zafar.
Land Rover models include Range Rover, Rang Rover Sports, New Discovery, Free Lander and Defender. Defender is the most common inPakistan. It is the best selling car by volume inPakistanwith the Army buying the maximum number. In the public sector, Range Rover is the best selling vehicle. Sigma Motors also provides up to the mark after sales services – a vital component of increasing sales.
Sigma Motors also started local assembly of Defender during 2002 with assistance from Gandhara Motors under a contract with the Ministry of Defense. Defender being one of the toughest off-road vehicle, is also very economical on fuel consumption as well as subsequent maintenance. After the start of local assembly of Defender, Sigma motors was approached by a number of vendors due to the fast provision of all parts and their after sale service. The assembly plant of Sigma Motors is in Port Qasim Karachi with annual production of 2000 units. Sigma Motors has 280 people directly employed, 100 indirectly and 600 to 800 if we include vendors.
On the duty structure of Govt, Mr Zafar suggested that if government wants more vehicles on the roads, they should reduce the duties. But most importantly the objective should be to generate the employment in the country, and for that the duty on CKD should be less and on CBU should be high. This is because the biggest issue of our country is unemployment. Whatever government does in the policy structure, whether they are allowing import of vehicles or local assembly, the approach should be to generate employment. In setting up an assembly plant more employment is generated as compared to import of vehicles. That’s why there is so much assembling inPakistan, which is good.
View on Market
As population and needs of people increase, so too should the options for cars in the market. In other words there is a remarkable potential for investment in Pakistan’s automobile sector, due to a growing urban middle class. The potential does not only lie on the assembling side or import of vehicles; it could well be on the spare parts side too, the vendors, customization business and mechanical work as well. More companies should enter the market in viable and sustainable ways. Government policies are not friendly towards exporting of vehicles because there is lack of subsides unlike China. In Chinagovernment subsidize the local assemblers so much that they are viable to export. Also inPakistan, there are power crises and the infrastructure is not that much developed.
Ferrari is made to move fast, Land Rover has a specialty to move on rough terrains with a high brand value, for e.g. the Defender. This is the vehicle which is capable of going on the toughest off-roads. The uniqueness of defender is that its body is made up of Aluminum alloy. There is no match for Range Rover; its best quality is safety. It is a very comfortable and reliable SUV. Also the power to weight ratio is the best in land rover vehicles, such that speed and power will remain the same irrespective of the number of passengers seated, due to the appropriate power-weight ratio.
The target market of Land Rover is very limited. It has a niche market, whose requirements are very precise. The resale might not be easy or high because of the limited target market. The pricing is shimming pricing policy, i.e. it’s a high priced luxury product. Exclusivity associated with the brand name means that advertising is very targeted.
Mr. Zafars advice to young entrepreneurs is that when they enter into the automobile or any other sector they should have very clear objectives and know their own capabilities. Groundwork prior to entering the sector is essential as a little knowledge is a dangerous thing. Mostly, hard work, perseverance and patience is the key to success and the ability to accept challenges.
Mr. Zafar sees a very bright future for the automobile sector in the coming days; emerging policies are conducive for growth and the vendors are increasingly experiencing a good turnover. Sigma motors have a positive plan to contribute in the market and I think there should be a volume seller in the market, Col Zafar. We are also interested in trucks and buses in the future.