PESTLE Analysis

Political factors: Economic factors:

 Pakistan Automobile Corporation:
Regulates and promotes Automobile
Industry
 Political Instability: Constant fluctuations
due to Power Struggle
 World Trade Organization Contracts:
Import duties to be gradually withdrawn
 Market Structure: Oligopoly, Industry is
dominated by small number of suppliers.
 Institutional Demand: a lot of demand is
there due to threat of security is present a
lot
 Price and Disposable Income: the price is
affordable to a lot of people in market
 Component prices: prices of the
components have increased
 Substitutes: Security censors and security
guards

Social factors: Technical / technological factors:

 Population Growth: Approx. 2.08% growth  Ever-changing
(2015)  Facial recognition feature can be copied
 Demographic Shift: More Urban  Threat of hacking
Population  Product can become obsolete after 2 to 3
 Increasing Brand Awareness/ Brand years
Preferences: Japanese Brands (Suzuki,  R&D is expensive
Toyota and Honda)
 Female Working Population: 25% (2014)
but increasing exponentially.

Legal factors: Environmental factors:

 Legal permit for the device is required
 Legal factors are favourable
 Firm needs to be registered
 No legal barrier
 Suitable for people to install it in their
homes
 Jewellary stores can also be targeted
 Can also be installed in factories
 Environment is favourable
 Growing need of these systems in home

Taxes: Direct/Indirect Taxes, 17% Sales Tax on local manufacturers which they claim to be
very high. Income Taxes also result in less disposable income resulting in less demand for
cars.

Survey conducted by Pakwheels.com and YouGov, reports that out of the total
respondents 94.40% were car owners. Japanese car brands topped the awareness chart
with Suzuki (90%), Toyota (89%) and Honda (85%) leading the rest.
The car financing has rose up to 30 percent in 2015-16, from 22 percent in 2014-15. Car
sales shot up to 180,079 units in 2015-16, from 151,134 units in 2014-15. Mohammad
Sohail, analyst at Top Line Securities, said car sales would rise from 2015-16 to 2020 at a
compound annual growth of 12% due to improvement in law and order situation, rising auto
financing owing to 43-year low interest rates and increasing disposable income.

Another projection of future growth is that Pakistan, which has 13 cars per 1,000 people in
2015-16, will rise to 20 cars per 1,000 by 2019-20. "Car sales will go up by five to eight
percent in the present fiscal year 2016-17, with a possible shift in market share in the
1,000cc category," analyst Asfia Aziz forecasted. "The market will see good gains as all
projections for auto production and sales indicate positive trend in 2016-17 and beyond." 

Female Working Population has increased by almost 100% from 1990 to 2014 such as from
being as low as 12.5% in 1995 to 25% in 2014.

Since Pakistan is a signatory of WTO Contracts, import duties are supposed to be withdrawn
gradually and not increased, this results in more cars to be imported hence effecting the
domestic market negatively.

http://www.tradingeconomics.com/pakistan/population-growth-annual-percent-wb-data.html

http://www.tradingeconomics.com/pakistan/inflation-cpi

http://www.saglobalaffairs.com/back-issues/288-pakistans-auto-industry-in-decline.html

http://www.ravimagazine.com/analysis-of-pakistani-automobile-industry-a-report/

http://www.ravimagazine.com/automobile-industry-in-pakistan/

https://tribune.com.pk/story/433950/overview-demand-for-cars-grows-but-choices-still-limited/

http://dailytimes.com.pk/business/16-Aug-16/experts-see-boom-in-pakistan-auto-industry

http://data.worldbank.org/indicator/SL.TLF.CACT.FE.ZS?
end=2014&locations=PK&start=1990&view=chart