KARACHI: Auto-part maker Loads Ltd will begin local manufacturing of alloy wheels, a stock notice has stated. Car assemblers currently import alloy wheels as they are not produced in the country. The company said its wholly owned subsidiary, Hi-Tech Autoparts, has signed an agreement with an Australian company for the purchase of a state-of-the-art manufacturing plant. Its procurement will be over within six months and the plant will be installed at Bin Qasim Industrial Park. A financial plan will be finalised in the ensuing board of directors’ meeting.
Meanwhile, an official of Loads Ltd said the company is buying a used plant from Australia from where global car makers have pulled out due to a liberal import policy and costly labour. Toyota Australia was the last manufacturer that closed down its operations recently. After the closure of the auto assembly, auto-part makers and allied industries in Australia are disposing of their machinery, plants and equipment.
The initial project cost of the alloy wheel unit in Karachi, including land price, hovers around Rs1.25-1.5 billion. The plant will have the capacity to produce 500,000 wheels per year. The company will provide alloy wheels to local assemblers initially. In the next phase, it will export the product and supply it to the aftermarket, depending on the market response, he said. The company has already talked to local assemblers about the product. The locally made alloy wheel will cost less than the imported one. Loads Ltd raised Rs1.75bn through an initial public offering two years back against the expectation of Rs0.75bn.
Meanwhile, steel traders have raised the price of steel bars by Rs5,000 per tonne as many dealers have stopped selling steel bars, thus creating an artificial shortage in order to further increase the prices.
A week back, quality steel bars were selling at Rs83,000-84,000 per tonne. He urged the government to control rates of steel bars as dealers have unjustifiably raised rates of steel bars after a sudden rise in dollar against Pakistani rupee.
Abad chief said that high rate and unavailability of steel bars would affect many ongoing projects, rendering builders to stop work.
He recalled that recently steel importers and dealers had raised steel bar prices after imposition of regulatory duty and now they have raised the rate in the name of rising dollar arbitrarily, which is illegal. He urged the government should take stern action against profiteers.
He said rise in steel bar prices would push up construction cost, making housing out of reach for low-income groups.
Quoting the World Bank and State Bank of Pakistan reports, he said Pakistan is facing shortage of 12m housing units and 0.3m housing units are being added to this shortfall every year.
The country’s economy would face a hard time if the government would not take corrective measures for the promotion of construction sector, he added.