Pragati to start assembling sedans by December

Pragati Industries Limited (PIL), a state-run automobile assembler of Bangladesh, is going to start assembling sedans of foreign make by December this year, according to company officials.

"Whether it is a Japanese or Korean brand, we will start assembling sedans by December," said Md Abul Kalam Azad, managing director of PIL, citing how they are already engaged in discussions to this end.

Earlier in May, the PIL had reached a consensus with Mitsubishi Motors Corporation (MMC) to establish a complete knock-down setup for assembling cars designed by the Japanese automaker.

"But the MCC is yet to inform us exactly how they would provide technical cooperation. Still, we are hopeful about getting a final decision soon," he told The Daily Star yesterday.

Azad also said they would expand the necessary facilities for assembling sedans with technical help from the MMC.

"To implement this with the approval of Prime Minister Sheikh Hasina, we sent our detailed plan to the MMC in the first week of July," he added. "We shared the plan with the MMC so that they can take necessary measures for technical cooperation."

As per the plan, the PIL aims to assemble Mitsubishi sedans with an engine capacity of 1.2 to 1.6 litres for regular customers in the country.

And barring any unforeseen circumstance, the company will be able to launch marketing campaigns for the new cars at the beginning of 2024.

Azad said the price of locally assembled models will be at least Tk 5 lakh less compared to imported ones as there is no supplementary duty.

As such, he believes customers will get brand new "Made in Bangladesh" sedans at reasonable prices in the near future.

"We will gradually use local components for up to 30 percent of a locally-assembled unit to ensure that it can be given the 'Made in Bangladesh' tag," Azad added.

Azad also said the PIL has skilled technicians with considerable experience in assembling Mitsubishi cars.

Besides, assembling such sedans is easy as the chassis will be imported with the engine from Japan.

PIL currently assembles sport utility vehicles, such as the Pajero Sport, active sports crossovers and double-cabin pickups of the Japanese brand as well as buses designed by India's Tata.

In March, Prime Minister Sheikh Hasina urged for using locally-manufactured cars of PIL instead of imported vehicles for development projects considering the current economic situation.

Regarding the budget, Azad said PIL will itself mobilise the necessary funds to set up the sedan assembling plant.

According to him, they will primarily assemble a minimum of 200 sedans each year on a pilot project basis.

"The number of assembled cars will then be gradually increased," he said.

Since 1966, Mitsubishi has been outsourcing its production activities in Bangladesh to PIL, which is a concern of the Bangladesh Steel and Engineering Corporation.

Pragati sold only 177 vehicles in the last fiscal year whereas 711 units were sold the year prior.

Azad said there is currently limited demand for new cars in Bangladesh, where most people buy second hand. However, he said Mitsubishi holds a significant share of brand-new car sales in the country.

At present, around 16,000 cars hit the streets every year, according to data of the Bangladesh Road Transport Authority.

During a visit to Bangladesh in May 2019, Ryujiro Kobashi, vice president of MMC disclosed they would invest in Bangladesh to produce their branded vehicles.

Kobashi sought policy support from the government in this regard.