Automobile body builders adding Tk 1.0 billion value

Shamsul Huda | Published: January 06, 2014 00:00:00 | Updated: November 30, 2024 06:01:00

The growing automobile body building industry is making over Tk1.0 billion local value addition to the imported chassis and engines of buses, trucks and other vehicles a year, sources said.
Approximately one thousand small, medium and large factories are scattered in different places of the country specially in Dhaka, Jessore and Bogra, sources said.
Bangladesh Automobile Body Building Association (BABBA) president Shahidul Islam Howlader said, "We are now building bodies for 15 per cent vehicles as 'remodelling' and 10 per cent for newly imported vehicles."
He said still most of the buses are imported as complete units and locally bodies are being built only for the imported vehicles with chassis and engines.
The BABBA president said if the government frames automobile policy saying Bangladesh can import only chassis and engines and bodies should be assembled locally and provides necessary facilities duty-wise then there could be more local value addition.
He said as the core industry of manufacturing chassis and engines are still not taking place locally so at the initial stage of automobile manufacturing the country can focus on body building.
A source in the industry said the budding automobile body building sector is as promising as the new shipbuilding sector and if the policy is in favour of local investment, it could be big industry within the next five years.
He said the body building industry is growing by 20 per cent every year as demand for buses, trucks, covered vans and other pickups are increasing in the local market.
According to other sources in this sector the growing skill by the local entrepreneurs is also paving the way for more body assembling.
He said on subcontracting basis the local body builders may get more work as the assemblers are getting more jobs for assembling.
According to an estimate currently more than 0.5 million trucks are plying in the country and the number of buses are also increasing every day.
He said in a small bus the body builders add Tk80,000 to Tk100,000 value and for a heavy vehicle the local value addition is more than Tk0.5 million to Tk0.8 million.
He said if the government devises a policy to support the local body builders and allow import of automobile chasis and engines only, the industry would be able to grow by 30 per cent every year.
Mr. Howlader said the existing Tk1.0 billion value addition could rise to Tk3.0 billion every year if the automobile policy supporting the local industry is declared.
He said the automobile manufacturing countries around the world also started their business initially with building body and assembling.
A source in this sector said local investments for assembling automobile have taken place and a few companies are advancing in manufacturing motorcycles and assembling vehicles.
He said the body building as sub sector is also growing by 20 per cent every year and it will hopefully increase as skill and expertise are there for bigger value addition locally.