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.