Regal Automobiles Industries Limited has announced plans to begin manufacturing electric vehicles in Pakistan next year, beginning with a compact electric car that can travel 180 kilometers on a single charge.
According to an official draught made available for listing at the Pakistan Stock Exchange, Regal is the only car manufacturer in Pakistan to build DFSK electric vehicles under a plant machinery plus CKD (Completely Knocked Down) supply arrangement with DFSK Motor Co. Ltd.
The company is in talks with a number of vendors about forming CKD collaboration agreements for the supply of parts for this little electric car. It would buy imported raw materials for the electric vehicle from DFSK as a CKD unit.
Regal will build the electric car assembly line as part of a strategic partnership with DFSK Motor Co. Ltd., under which the company has signed a Memorandum of Understanding for the import of plant and machinery for the electric vehicle assembly with ChongQing Sokon Motor (Group) Imp. & Exp. Co. Ltd., DFSK Motor Co. Ltd.’s exclusive supplier.
Within the current freehold land, a block of industrial land totaling 3 acres has been set aside for the project. The plant will be imported in December 2021, and the project’s building construction will commence in December 2021.
The project is planned to be finished by February 2023, following which commercial production will commence.
The government has set a goal of producing 100,000 cars in the next five years, while two- and three-wheeler vehicle production would increase to 500,000 in the same time frame.
Globally, the automobile industry is transitioning from hydrocarbon-based vehicles to environmentally friendly vehicles (hybrid and electric), with the primary goal of reducing carbon emissions to protect the environment.
Promoting environmentally friendly vehicles, on the other hand, is expected to play a key role in reducing oil imports (oil is Pakistan’s largest import commodity), increasing foreign direct investment in the automobile sector, new employment opportunities, increased environmental awareness, the potential to lift the automobile sector by a factor of ten, and improving the country’s overall socio-economic situation.
Regal will benefit from the following perks from 2021 to 2026 if it starts an electric car initiative:
- The CBU import for all Electric Vehicles will be charged a 10% custom duty
- The imports of CKD for Electric Vehicle assembly will be charged 1% custom duty
- The import of plant and machinery for 4-wheeler Electric Vehicle assembly will be charged a 0% custom duty
- The Electric Vehicle charging equipment will be charged a 1% custom duty
- The retail price of an Electric Vehicle will be exempted from any FED and will only be charged a 1% sales tax
- The import of Completely Built Unit of Electric Vehicle is allowed at a rate of 0% sales tax
- The State Bank of Pakistan (SBP) has given a special window for EV car financing at the rate of 1% SBP rate plus 4% spread.
To read our blog on First Huawei HarmonyOS-Powered EV to be launched by DFSK sub-brand, click here.