Scania enters Pakistani market

Scania enters Pakistani market

Pakistan, with a population of approximately 200 million, has for years been a white spot on Scania’s map. But not any longer. Recently, Scania appointed Yousuf Dewan Truck and Bus Company as its distributor to sell trucks and buses in this populous country.

Japanese, Korean and Chinese manufacturers today dominate the market for heavy vehicles although several of Scania’s European competitors are also present. However, the total market is modest for a country of Pakistan’s size.

“We are especially hopeful in selling high-end coaches,” says Tobias Ekstedt, who is managing the establishment in Pakistan. “We know that there are sufficiently many customers that are willing to pay to travel in comfort between the major cities.”

Initially, Scania will sell complete buses with bodies from its production in Europe and Brazil. “There is certainly a potential for both local assembly and bus bodybuilding, which we might consider in the future.”

A market for more efficient trucks

In the truck business, the country is particularly interesting in view of the new links from central China to the Pakistani port of Gwadar that are now under construction. A new 1,100-kilometre motorway is being built between the country’s two largest cities, Karachi and Lahore, while the roads leading to and from the Chinese border are being substantially upgraded. With the new route, sea transport from China can be reduced by three weeks and shipments from the oil producing countries in the Middle East substantially shortened.

“This opens a market for more efficient trucks. We will have a modern infrastructure with higher average speeds. Fuel now constitutes half of transport company expenditure and, as we know, Scania is leading in this area. Initially, we are focusing on high-value goods transport. Fuel and gas transportation is a high-volume segment where European competitors have had success lately.”

Scania also hopes to deliver trucks to the Pakistani mining sector. It is perhaps less known that the country, for example, has the world’s fifth largest gold deposits.

Scania’s distributor, Yousuf Dewan Truck and Bus Company, belongs to the Dewan Mushtag Group, a conglomerate with businesses in the textile, cement and sugar production industries. It also imports BMW passenger cars to Pakistan as well as assembles Korean cars.

Following the establishment of a service and sales organisation, Scania annually expects to sell some 100 trucks and buses.