Rangs to rev up car assembly
Rangs Limited, a concern of Rangs Group, plans to expand its line of locally assembled cars this year to tap into the spiralling demand for affordable personal vehicles from the growing middle-class.
Rangs has been locally assembling Mitsubishi Outlander, a crossover sport utility vehicle (SUV) designed by Japan's Mitsubishi Motors, for more than three years now.
The country's leading car marketer is now considering whether to introduce two more models to the domestic market.
"From the assembling's point of view, the prospect is very good," said Shoeb Ahmed, divisional director of Rangs Limited.
Rangs, which distributes Mitsubishi vehicles, has so far assembled more than 200 SUVs which are now in the market.
Rangs now wants to assemble nearly 200 more SUVs in 2021, according to Ahmed.
Three local companies -- Rangs Limited, state-run Pragoti Industries and Chattogram-based PHP Family -- have been assembling cars for the past several years.
Pragoti assembles Mitsubishi cars while PHP Motors manufactures cars made by Malaysia's Proton.
Recently, Fair Group said it is going to assemble cars made by Korea's Hyundai Motors.
The annual demand for passenger vehicles is around 25,000 units with reconditioned cars imported from Japan accounting for a majority of these sales.
Roughly, 22,000 reconditioned cars are imported each year.
However, the domestic market for brand new cars is slowly expanding while local assembly is beneficial in terms of price reduction thanks to lower tariffs on completely knocked down (CKD) kits.
"We are getting the benefit of some value addition locally too," Ahmed said, adding that Rangs ensures quality and provides training to its workforce to develop technical skills.
"Now, we can do the full work of assembling with our efficient human resources. We hardly need assistance from anyone from abroad," he said.
But CKDs are an essential part of the overall manufacturing process and so, formulating the automobile policy would facilitate growth in local manufacturing.
"Foreign manufacturers may feel interested to come to Bangladesh once the automobile policy gets the nod from the government," Ahmed added.
When the policy is passed through the cabinet, the automobile manufacturers will then have an idea about the amount of investment, expertise and technologies required to establish a successful project.
The automobile industry is capital-intensive and it takes a lot of time to develop the sector into a manufacturing hub.
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When the automobile policy will be published, activities related to the backward and forward linkage industries will grow, which will promote local component manufacturers.
"After a comprehensive policy, if progressive manufacturing starts in Bangladesh, new cars will be highly affordable," he said, adding that the industries ministry should be more active to get the policy quickly approved.
"An explicit, investment-friendly and consistent automobile policy will help us shape up the future of the country's automobile industry," Ahmed added.
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