Report on – Uttara Motors

Report on “Uttara Motors”.

INTRODUCTION

Uttara Group of Companieswas established in March 1972. The Group is one of the leading industrial, trading and agency houses and also represents country’s largest automobile sector. Uttara Group of Companies (UGC) a private limited company offers wide – range of multi-disciplinary trading and marketing services is aimed at and fully geared to achieve a sustainable break-through in the business world. The trading sector mainly holds the distributorship of Japanese and Indian origin automobile manufacturers and various types of basic vehicles, which contribute and fulfill the demand at a large, extend of country’s transport and communication sector. The industrial activities fairly includes assembling of Trucks, Buses, Auto-rickshaw, Motor Cycles and Manufacturing of Luxury Coaches and exports of Apparels, Knit Wear, Sewing thread.

Uttara Group is deeply committed to fulfill customers’ demand and cares about consumers’ desire & taste. Placing emphasis on this important aspect UGC has initiated a new edge of business activities bridging two–way traffic between the manufacturers and the ultimate consumer in the present competitive world market. To protect valued customers’ interest, saving, safety, security, comfort and satisfaction the Group has also introduced insurance and investment financing scheme.

To fulfill missions’ objectives Uttara Group represents the following companies, which are currently involved in exporting, importing, general trading, manufacturers representation, distribution, sole agency, insurance and financing.

NATURE OF BUSINESS:

Govt. approved automobiles marketing company, Sole Distributor of Isuzu, Suzuki Vehicles from Japan and Bajaj, Swaraj Mazda & Maruti Vehicle from India. Parts & Accessories, Sawafujii & Suzuki generator from Japan, Scott & English industrial generator from Singapore & G.S. battery from Indonesia.

Aim of Uttara Group of Companies:

The sky is not the limit for them but their expectations are within limit. Their imagination soars beyond conventional barriers. They share their destiny with their beloved motherland. They want to serve her the better in the greater quest for national economic emancipation.

Uttara Group of Companies and their way:

To a seasoned trekker, the path is never too arduous. They believe in progress, in destiny and service through entrepreneurship. They are merchants and missionaries, doers and dreamers, entrepreneur and experts. They are futuristic with emphasis on creative and dynamic activity.

Growth and development of Uttara group of companies:

Uttara Group of companies is one of the large groups of company in Bangladesh. They work for the objective, policy and some rules, so that they achieve a position in marketing their products in Bangladesh.

Corporate Office

39 Dilkusha Commercial Area;

Dhaka-1000

Bangladesh.

Tel: 880-2-9555280, 9564163,

Fax: 880-02-9565172,

E-mail: uttaragp@citechco.net

Corporate Management:

Mr. Matiur Rahman – Chairman & M.D.

Mr. Mujibur Rahman – Deputy Managing Director

Mr. Durand Mehdadur Rahman – Deputy Managing Director

Mr. Rafiqur Rahman – Director

Mr. K. I. Hossain – Executive Director

Mr. Anup Kumar Barua – Director (Apparels)

Mr. Shahidur Rahman – Director (Knitting & Dyeing)

Mr. S. A. Humayun Ahmed – Director (Technical)

Mr. Mir Mohammed Hossain – Director Marketing

Production Lines:

Assembling & Manufacturing:

3-Wheeler Bajaj Auto-rickshaw.

2-Wheeler Bajaj Motor Cycle

Isuzu Commercial Vehicle

Swaraj Mazda Commercial Vehicles

Sole Distributor:

Suzuki Vehicles

Maruti Vehicles

Bridgestone Tyre

Isuzu Vehicles

Swaraj Mazda Vehicles

Re-treading Tyre.

Sawafuji, Suzuki & Scott English Generator

GS Battery Indonesia

Manufacturer:

Knit Fabrics

Knit Garments, Woven Garments

Sewing Thread

Pharmaceuticals

Overseas Principals:

Isuzu Motors Ltd., Japan : Assembler / Distributor

Suzuki Motors Ltd., Japan : Distributor

Bridgestone Corporation : Distributor

Mitsui & Co., Japan : LocalAgent (Trading)

Itochu Corporation Ltd., Japan : Local Agent (Trading)

Sawafuji Generator Ltd. Japan : Distributor

Suzuki Generator Ltd. Japan : Distributor

Bajaj Auto Ltd., India : Assembler/ Distributor

Swaraj Mazda Ltd., India : Assembler / Distributor

Maruti Udyog Ltd., India : Distributor

Pak Suzuki Motor Co. Ltd : Distributor

Concern of the Group:

Eastern Motors Ltd.

NIB House, 32 Agrabad, Chittagong.

Chittagong

Legal Form : Private Limited Company

Establishment Year : 1952

Nature of Business:

Sole Distributor of “Bridgestone” brand tyres and tubes from Japan.

Concern of the Group:

Uttara Motors Ltd.

39, Dilkusha C/A

Dhaka-1000

Bangladesh

Legal Form : Private Limited Company

Establishment Year : 1973

Nature of Business:

Govt. approved automobiles marketing company, Sole Distributor of Isuzu, Suzuki vehicles from Japan and Bajaj, Swaraj Mazda & Maruti vehicles from India. Parts & Accessories, Sawafuji & Suzuki Generator from Japan, Scott & English industrial Generator from Singapore & G.S. Automotive battery from Indonesia.

Concern of the Group:

Menoka Motors Ltd.

39-Dilkusha C/A

Dhaka-1000

Bangladesh

Legal Form : Private Limited Company

Establishment Year : 1979

Nature of Business:

Assembler of Bajaj 3-wheeler and Bajaj Motor Cycle from India.

Concern of the Group:

Uttara Tyre Retreading Co. Limited

39-Dilkusha C/A,

Dhaka

Bangladesh.

Legal Form : Private Limited Company

Establishment Year : 1989

Nature of Business:

American “BANDAG” brand Tyre cold process Retreading plant in Bangladesh under exclusive franchise of USA.

Concern of the Group:

Uttara Apparels Ltd.

39-Dilkusha C/A

Dhaka-1000

Bangladesh.

Legal Form : Private Limited Company

Establishment Year : 1991

Nature of Business:

100% export oriented apparels factory.

Concern of the Group:

Uttara Knitting & Dyeing Ltd.

39-Dilkusha C/A

Dhaka-1000

Bangladesh.

Legal Form : Public Limited Company

Establishment Year : 1994

Nature of Business:

Manufacturer of 100% export oriented Quality Knit Fabrics with Dyeing and Finishing facilities.

Concern of the Group:

Uttara Hongkong JVC Ltd.

23, Paribagh (2nd Floor)

Sonargaon Road

Dhaka-1000

Bangladesh.

Legal Form : Private Limited Company JV

Establishment Year : 1994

Nature of Business:

Manufacturer of sewing thread for export to garments industries.

Concern of the Group:

Uttara Finance & Investments Ltd.

10 – Dilkusha C/A, Jiban Bima Tower,

Dhaka-1000

Bangladesh.

Legal Form : Public Limited Company

Establishment Year : 1995

Nature of Business:

Lease Finance, Investment & Merchant banking.

Concern of the Group:

Uttara Services Ltd.

124-North Begun Bari

Tejgaon Industrial Area

Dhaka

Bangladesh.

Legal Form : Private Limited Company.

Establishment Year : 1996

Nature of Business:

Automotive Vehicle Repairing & Servicing

Concern of the Group:

Uttara Exchange & Securities Ltd.

Pedrollo Plaza

5-D Jubilee Road

Chittagong

Bangladesh

Legal Form : Private Limited Company.

Establishment Year : 1996

Nature of Business:

Member of Chittagong Stock Exchange and deal in Public Limited company shares.

Concern of the Group:

Hallmark Pharmaceuticals Ltd.

124-North Begun Bari

Tejgaon Industrial Area

Dhaka

Bangladesh

Legal Form : Private Limited Company

Establishment Year : 1997

Nature of Business:

Manufacturer of Medicine.

Concern of the Group:

Uttara Properties Ltd.

39-Dilkusha C/A

Dhaka-1000

Bangladesh.

Legal Form : Private Limited Company.

Establishment Year : 1997

Nature of Business:

Real estate business

Concern of the Group:

Uttara Knitwears Ltd.

39, Dilkusha C/A

Dhaka-1000

Bangladesh.

Legal Form : Private Limited Company

Establishment Year : 2000

Nature of Business:

Manufacturer of 100% export oriented Knit Garments.

Concern of the Group:

Uttara Automobile Manufacturers Ltd.

39-Dilkusha C/A

Dhaka-1000

Bangladesh

Legal Form : Private Limited Company.

Establishment Year : 2002

Nature of Business:

Manufacturer of Isuzu Pickup Cabin and Swaraj Mazda Truck Cabin.

Concern of the Group:

Uttara Motors Corporation Ltd.

Plot No, A-6, A-7

BSCIC, Industrial Area, Bogra

Bangladesh

Legal Form : Private Limited Company.

Establishment Year : 2005

Nature of Business:

Assembler of Bajaj Motor Cycle from India.

Human Resources:

Company Name Male Female Total

Uttara Motors Limited 237 9 246

Uttara Automobiles Ltd. 66 1 67

Uttara Tyre Retreading 47 – 47

Uttara Finance & Investment Ltd. 13 2 15

Uttara Hongkong JVC Ltd. 23 4 27

Uttara Exchange & Securities Ltd. 15 – 15

Uttara Knitting & Dyeing Ltd. 390 1 391

Uttara Apparels Ltd. 310 540 850

Uttara Services Ltd. 55 3 58

Uttara Properties Ltd. 9 1 10

Hallmark Pharmaceuticals Ltd. 124 3 127

Eastern Motors Ltd. 40 – 40

Menoka Motors Limited 246 – 246

Uttara Knitwears Limited 80 300 380

Total: 1,655 863 2,518

Branches:

Chittagong:

880-031- 724402, 724957,

715342

Sylhet:

880-0821- 717782, 761173,

Mobile: 017- 881038

Rajshahi:

880-0721- 773741, 773682,

Mobile: 017- 881036

Bogra:

880-051- 6360, 72547,

Mobile: 017- 881037

Khulna:

880-041- 725952,

Jessore:

880-0421- 64087, 72710,

Cox’s Bazar:

880-0341- 63555

Dinajpur:

880-0531- 64687

Pabna:

880-0731- 64690

Rangpur:

880-0521- 62922

Barisal:

880-0431- 55349

Financial Structure

(In Million Taka)

Year	1999-2000	2000-2001	2001-2002	2002-2003
Capital
Paid-up	206.98	196.98	212.98	212.98
Annual Turnover	2123.49	3069.98	3487.54	6121.26
Annual Profit	194.72	392.65	451.55	544.84
Net Asset	1417.33	1490.20	1568.44	1646.86

Commercial and Passenger Vehicles Sales Profile:

AUTOMOBILE SECTIONS IN BANGLADESH

While assessing the demand and supply of auto parts and components in Bangladesh, it is essential to analyze the users, their usage habits and requirements and other related aspects of auto parts and components. The automotive sector that uses various parts and components in Bangladesh comprises of both imported and locally assembled vehicles. In estimating the overall demand and supply of auto parts and components, it is important to critically look into the existing scenario of automobile industry in Bangladesh since these two things are inter-related and positively correlated.

Existing scenario of automobile industry in Bangladesh

Bangladesh does not have automobile industry worth the name except the single government owned agency i.e. Progati Industries Limited involved in assembly of CKD/SKD automobiles.

Over the last two decades, particularly since 1985, the use of various types of vehicles has shown a definite increased trend. Reasons are many, namely, increased income of particular segment of people, availability of financial support, improved roads and high ways, increased level of economic activities, increased mobility of people from one place to another in search of jobs, increased volume of trade, commerce and export, etc.

It may be mentioned here that only the export oriented ready made garment and textile industries required a large number of various types of vehicles stating from heavy duty carrier, pickup van, truck, etc. to motor cars. This single largest sector needs various types of vehicles for various purposes and account for about 65% of the country’s commercial transport requirements.

Increase in the mobility of individual people has also resulted in a tremendous increase in the use of various light motor vehicles. There are few assembling houses that assemble small quantity of vehicles compared to the total demand of the country.

Most typical character of Bangladesh automobile sector is that there is a wide variety of brands and the countries of origin mainly include countries like Japan, India, South Korea, China, Germany, France, Malaysia, UK and USA. Following brands of vehicles are now available in the local market that require different types of parts and components on regular basis:

Table 1: Different brands of vehicles in Bangladesh

Products category	Brand names
Heavy Bus	Hino, Mitsubishi, Isuzu, Volvo, Tata, Ashok Leyland, etc.
Mini bus	Hino, Mitsubishi, Isuzu, Toyota, Sawraz Mazda, Tata, Richer, etc.
Microbus	Nissan, Mitsubishi, Toyota, etc.
Heavy truck	Hino, Tata, Bed Ford, Isuzu, Ashok Leyland
Mini Truck	Hino, Tata, Mitsubishi, Isuzu, Toyota, Richer, Sawraz Mazda, etc.
Motor Car	Toyota, Mercedes Benz, Nissan, Mitsubishi, Ford, Suzuki, Dewoo, Proton Saga, Proton Vira, Hyundai, BMW, Maruti etc.
Four wheels	Toyota, Tata, Mitsubishi, Nissan, etc.
Auto tempo	Bajaj, Krishan
Scooter	Bajaj, Krishan
Motor-cycle	Honda, Xingfu, Jialing, Jangshen, Yamaha, Suzuki, Hero, TVS Victor, Bajaj, Vespa, etc.
Light & heavy commercial vehicles	Nissan, Dewoo, Huyandi, Volvo, Ashok Leyland, Tata, Hino, Mitsubishi, etc.
Farm and agricultural vehicles	Hyundi, Dewoo, Dongfang, Dongchang, etc.

Basically, parts and components are required for the above types of vehicles from countries of origin or from other reliable sources. Use of parts and components has a positive co-relation with number of vehicles in use in the country. During the last five years, the following vehicles were imported in Bangladesh:

Factors influencing increase in demand of automobile

Factors influencing increase in demand of vehicles are as below:

Government annual development plan has given priority on transport and communication development; Government has introduced effective transport policy in its five-year plan; Availability of financial support from formal and informal sources. Formal sources are banks, leasing companies, purchases companies, renal companies etc; Encouragement of the private sector to make investments in automobile industry; Promulgation of laws to make the importation of vehicles at cheaper price (duty and taxes reduced to import new vehicles); Improved roads and highways and increased number of bridge and culverts; Improved life style in the urban areas;

Alternative and cheaper means of fuel, like natural gas; Adaptation of improved technology in agricultural activities/cultivation activities. There has been an increasing trend in the use of all sorts of automobiles/vehicles in Bangladesh. However, the increased demand of individual types of automobile varies from case to case. For example, the use of motor cars for personnel and official movement has increased at a higher rate than other types of vehicle. Also, the use of urban commercial vehicles has also increased at a higher rate to meet increased requirements. These trends are expected to continue in future.

Comparative scenario of different types of automobiles in Bangladesh

A comparative scenario of different vehicles and their usage trend may be explained as below:

 

(a) Motorcycle

There is an increasing trend in the use of motorcycle in Bangladesh by a new group of users. Traditionally, students, individual businessmen, officials of marketing companies and pharmaceutical industries use motorcycles. Over the last one and a half decades, the field level officials of different non- government organizations have been using a large number of motorcycles. Also, there are some occasional uses of motorcycle like election campaign and other national and social program. In Bangladesh, both locally assembled motorcycle and imported motorcycle are available for intending users as detailed below:

(i) Locally assembled motorcycle: Mainly, there are about 20 locally assembled brands. For example, ATLAS, EMMA, NITOL and SINGER. List of the local motorcycle assembling houses is given in the annex.

(ii) Imported motorcycle: There are at least 7-8 different regular brands of motorcycle and these are: Honda CD 80, Yamaha, Suzuki from Japan, Xinfu, Jangshen, Jailing, Hero, TVS Victor, Yamaha, Suzuki, Bajaj, Vespa, etc.

Motorcycle is extensively used in Bangladesh in both rural and urban areas. The use of motorcycle has gradually increased in Bangladesh due to several reasons as mentioned below: Easy to drive; Easy access to remote location; Cheapest transport; Longevity of the vehicle; Easy to handle and park at any place. While assessing the future demand of motorcycle, we observe that there is an increase in the use of motorcycle facilitated by the present trend of economy and the changed behavior of the target users. Key factors influencing the market demand of motorcycles are: Withdrawal of three wheelers by the Bangladesh Government creating more demand for motorcycle by certain segment of people; Improved roads and high ways; Availability of leasing finance facilities by almost all leasing companies, banks and financial institutions. At present, there are a limited number of producers of spare parts of motorcycle in Bangladesh. Therefore, the major spare and parts are imported form different countries like Japan, China, India, Pakistan, Italy, England, America, Germany, etc.

 

b) Auto rickshaw / Three wheelers

There has been a tremendous increase over the past two decades in the number of auto rickshaw and tampoo in Bangladesh to compensate for inadequate number of commercial buses, minibuses, etc. Now, it is an important vehicle in Bangladesh. Low and middle class family members mainly use these vehicles. But, the government of Bangladesh has already banned these two vehicles to avoid environmental pollution. It is estimated that presently there are 160,000 auto rickshaws including unauthorized units in Dhaka City alone. There has been a phenomenal.-

However, effective 1^st September,2002, the two stroke auto rickshaw will be totally banned, which is expected to dramatically reduce the requirement of parts for these type of vehicles, but increase demand for the new CNG auto rickshaw andthree stroke auto rickshaws will be there with increased demand for parts and components.

 

(c) Motorcars

Increased demand, economic development and changed life style have resulted in a great increase in the number of motor cars and the demand for motor cars is still increasing day by day. Both brand new and reconditioned cars are imported into the country. Statistics show that majority of the people usually prefer reconditioned motorcars more than brand new cars due to lower price.

In Bangladesh, more than65% of the total motorcars are coming from Japan. Many Bangladeshis living in Japan involve themselves in reconditioned car business. Recently, the government has put an age restriction on the import of reconditioned motor cars. Reconditioned cars more than 3 years old can not be imported.

The government has also reduced the duties and taxes on the import of new cars to discourage reconditioned car import. Impact is that people now can buy new cars at a reasonable price having longer durability. The government has introduced new system of taxicab in 1998. As a result, the number of motorcars has been increasing. But, the requirement of spare parts and components will be lesser. Again, after the 1^st September 2002, the ban of auto rickshaw will lead to a significant increase in motorcars mainly in the form of taxi cabs. Use of motorcars has increased tremendously, which is evident from the statistics for the last five years shown in the chart below:

 

(d) Light & heavy commercial vehicles (bus, minibus, truck, pick-up, etc)

Like the motorcar, there has been an increasing trend in the number of light and heavy commercial vehicles that include mini bus, bus, human howlers, passenger carriers, trucks, pick-ups, covered vans, large covered vans, etc. Over the last one decade, the use of these types of vehicles has increased at a high rate. This is due to increased demand for the these types of vehicles/automobiles effectively backed by institutional financial support to procure them. This growth rate will continue to increase in the near future. The average growth rate is 5.63% and 4,644 in the number of vehicles annually.

 

(e) Farm and agricultural equipment/vehicles

Also, there is an increasing trend in the number of farm and agricultural equipment/vehicles due to increased application of modern tools and techniques in farming and agricultural production. Now-a-day, agricultural vehicles like power tiller, tractor and trailers are being used in the rural areas more frequently than the past. During the last one decade, various agricultural development projects funded by the different donor agencies have been implemented in the rural areas and under those programs, the farmers were given financial facilities through NGOs and banks to procure modern agricultural equipment including farm vehicles.

Traditional cow based cultivation method is giving away to mechanized farming in the rural areas of Bangladesh. One of the key elements that made this possible is the availability of lease financing facilities in the country and the large amount of agricultural credit funds. It has been observed that there is a reasonable growth in the number of agricultural equipment every year. This growth rate will continue to increase in the near future provided there is no drastic change in the government policy relating to agricultural sector like reduction in the subsidy and assistance and low cost fund for the farmers. The average annual growth rate is 2.5% and 125 in number of vehicles every year.

Estimated demand of automobile /vehicles in Bangladesh

Taking into consideration the future prospects and also keeping the resent growth pace influenced by various elements discussed earlier, it is expected that there would an additional increase in the use of vehicles. In view of the possible new avenues and prospects and looking into the weighted average growth rate of 6%, table below shows estimated demand for the next five years.

Table 2: Projected demand of automobile /vehicles in Bangladesh

 

Regulatory environment and the role of the Government

After independence in 1971, the country had to follow the rules and regulations of the then Pakistan government. Even soon after 1971, the same rules and regulations were followed with slight modification. Before 1982, the government did not effectively control the sector to the extent now it is. However, the regulatory body needs reforms and restructuring to bring efficiency and dynamism in day-to-day work. Effective program to modernize and expansion the regulatory body has become indispensable to handle the expanded activities in the total transport sector. They are mainly concerned with the environmental impact, registrations of vehicles, road and route permits; licensing of vehicles; and vehicle fitness for plying on roads, etc.

AUTO PARTS AND OTHER COMPONENTS INDUSTRY IN BANGLADESH:

As Bangladesh have no automobile industry, the sector is totally depended on import, except a few automobile-assembling units. Every year number of automobile is increasing due to increased requirement, demand as well as increased population. The sector has growth potentials.

Consumption of auto parts depends on several factors. There is a numerous types of auto parts being used by different types of automobile. Some parts have very short usage time and some have longer usage time. In Bangladesh, since there is no automobile manufacturing plant, there is not enough producers of auto parts. However, there is an area in southern part of Dhaka City where there are few indigenous auto parts manufacturing units. These parts are required for the exterior purpose but not for the important and critical interior purpose. These are limited to horn, light, glass, mirror, etc.

Total demand for parts and components will increase in future because of increased use of vehicles on roads, which has to be met by imports and import only.

The projected demand of auto parts of various types of vehicles are estimated below: Supply and demand survey on automotive components – Bangladesh

Table 3: Projected demand of auto parts import in Bangladesh

Structure of the auto parts market

The parts and components market in Bangladesh is almost 100% import based. There is no quality local manufacturer of parts and components. So, several groups of importers of parts and components are there that include commercial importers, automobile assembling houses, public sector institutions and diplomatic importers. In Bangladesh, parts and components are mainly imported from countries like Japan, UK, Taiwan, China, Korea, Malaysia, USA, India, Indonesia, Pakistan, etc.

The market of parts and components is very small but expanding rapidly. Commercial importers facilitate bulk quantity import of parts that are distributed through wholesalers and retailers. End users get the parts from the retailers and the retailers buy parts from the importers. However, there are also importers who have their own retail outlets. An assembler may also be an importer who requires a large quantity of parts and components for its assembling unit. A limited number of commercial importers import parts and components from different sources as mentioned above.

In most cases, the assembler imports parts and components from the country where the brand is originated. Some assemblers even purchase parts and components directly from the big importers. There is another group within the distribution channel of parts and components i.e. auto servicing centers like garage, mechanical workshop, body building units, etc. The servicing centers purchase parts from the whole seller as well as from the retailer. End users get parts and components from retailers dealing in different type and brand of automobile. Although no local manufacturer of quality parts does exist, but active negotiations are going on to set up joint venture parts and component manufacturing units with China, Korea and Taiwan. Present structure of parts and components market is graphically shown below:

In Bangladesh, neither we have an automobile industry nor a quality auto parts industry. So, the people of Bangladesh have no clear idea about the automobile industry or auto parts and components and their usage. The market of auto parts and components is influenced by couple of elements. People while purchase auto parts and components, they are influenced by several factors and these auto servicing centers, workshop and garage, motor pool managers, Institutional Importers (i.e. embassy), retailers, agents of branded automobile, etc.

Foreign exporters of automobile components

The automobile market in Bangladesh has been dominated by the multinationals from Japan, Korea, China, India, and Europe since independence. Still the multinationals play significant role to meet the demand and supply and occupy a large market share in comparison to their number. Over the last couple of years, some automobile importers like Nitol Motors, Uttara Motors, Aftab Vehicles, Ifad Autos, Meghna Vehicles, Navana Vehicles, etc. have enter the local market. But, as our local automobile market are 65% dominated by Japan, we continue to import a large share from Japan. There is large market for the exporters of automobile parts and components of the participating countries as the local industry is based on the imported components.

Domestic parts and components industry

Presently, there is no well-organized and quality manufacturer of parts and components in Bangladesh. Some low quality indigenous manufacturing of parts and components are there but they are carried out against specific order to meet emergency requirement. There is no mass production to meet the requirements. Given below are some idea of what the local manufacturers try to produce: Filters, radiators, radiator hoses, air filter housing; Brake pads, brake drum, brake disc; Electrical parts such as battery, horn, wiring, wiper and washer assembly, head lights and other lights; Trim and upholstery such as carpet, floor mat, rear parcel shelf, seat assembly, safety belt and melt damping sheet; General parts such as paint and thinner, under seal, tyres and tube, and mirrors.

Import policy and procedures

Government is committed to foster a gradual development of free market economy in the light of GATT agreement. In the interest of export promotion and investment in the country, Bangladesh have long term, stable, facilitative and liberal Import Policy. Efforts have been made to make the Import Policy easier and more liberal by relaxing or rescinding the regulatory provisions of the previous Import Policy. Provisions have already been made to allow import of capital machinery and industrial raw materials on consignment basis without the cover of the Letter of Credit. In the present Import Policy Order second hand / reconditioned machinery are importable subject to fulfillment of certain conditions. Gradually efforts will be made to classify those machinery under HS Code.

Rules and regulations on imports

For import purpose, the new ITC Numbers (HS Code) can be uses with at least six digits corresponding to the classification of goods as given in the Import Trade Control Schedule 1988, based on the Harmonized Commodity Description and Coding System, shall be mandatory.

Import of any goods or machinery in Bangladesh will be done according to certain rules and regulations as laid down in the “Imports and Exports (Control) Act, 1950”. Parts, accessories or component, import of which is otherwise banned or restricted, shall however, be importable along with machinery item is permissible for import.

Manufacturing age of the used reconditioned vehicles must not be more than three years at the time of shipment. In case of determining the date/age of the concerned vehicles, the age of the vehicles shall start counting from the first day of the next year of manufacturing. In case of vehicle made in Japan, the date of manufacturing shall be determined from the chassis book, published by the Japan
Automobile Association. In case of import of vehicles made in other countries where chassis book is not published, importer shall submit a certificate regarding the date of manufacture of vehicle from an internationally reputed surveyor firm.

Commercial import of second hands/reconditioned engines and gearboxes of bus, truck, mini – bus and macro bus will be permissible. But such engine and gearboxes shall not be permissible for import if they are more than five years old. In this case a certificate regarding age-limit, either from exporting country’s recognized Chamber of Commerce & Industry or from internationally reputed surveyors shall be submitted to the customs Authority at the time of release of the goods.

Following documents along with the LCA must be submitted to the nominated banks by the importers:

L/C application form duly signed by the importer; indents for goods issued by indent or a pro forma invoice obtained from the foreign supplier; insurance cover note.

Government regulations on imports

 

(a) Pre-shipment inspection

Unless otherwise specified, pre-shipment inspection of imported goods shall not be obligatory in case of import by the private sector importers.

 

(b) Import procedures

(i) Import License not required: No import License will be necessary for import of any item;

(ii) Import against LCA Form: unless otherwise specified, all imports transacted through a bank (L/Cs, bank drafts, remittances etc.) shall require LCA form irrespective of the source of finance;

(iii) Import against L/C: Unless otherwise specified, import shall be made only by opening irrevocable letter of credit (L/C);

However, L/C is not required for import of each consignment, by road, of easily perishable item valued form $US 5,000 to 7,500 and for import of capital machineries and raw-materials for industrial use without any price limit. Existing conditions regarding import on deferred payment under L/C shall be applicable in this case also and importer shall be required to register with Bangladesh Bank for importation without L/C.

(iv) Import against LCA Form but without opening of Letter of Credit (L/C): Import against LCA Form may be allowed without opening of letters of credit;

(v) Import on deferred payment basis or against supplier’s credit: Subject to restriction and prohibitions contained in this order, import on deferred payment basis or against suppliers. Credit may be allowed on the basis of procedure laid down by the Bangladesh Bank in this behalf;

(vi) Import against direct payment abroad: Only Bangladeshi nationals living abroad may send any importable item irrespective of value ceiling against direct payment abroad in the name of any Bangladeshi living in Bangladesh. The name and address of the consignee shall be mentioned in the import documents. For such import, no permission or import permit from the Import Control Authority shall be necessary;

(vii) Document required to be submitted along with LCA Form: Importer in both public sector and private sector shall submit to their nominated banks the following documents along with the L/C Authorization Form for opening letter of credit: L/C application form duly signed by the importer; Indents for goods issued by indent or a pro forma invoice obtained from the foreign suppler, as the case may be; Insurance cover note;

(viii) Auditioned documents to be furnished by public sector importers: In addition to the documents mentioned above, the following document will be required. The attested photocopy of sanction letter from the Administrative Ministry or Division or Authority, wherever applicable;

(ix) Additional documents to be furnished by private sector importers: In addition to the document mentioned above, the following documents will be required.

Categories of importers and eligibility criteria for issuance of import license

Generally, there are three categories of importers are in Bangladesh. To import automobile, the importers have to have the following criteria:

1. Foreign firms

Foreign firms are allowed to import permissible commercial items against prior permission from the Chief Controller of Import and Export and need to provide following documents:

Photocopy of the valid Import Registration Certificate; Photocopies of invoices, bill of lading, and import permit duly certified by the bank; Original or copy General Index Register (GIR) certificate from Income Tax Authority; Certified copy of the last income tax assessment order; and Name and description of each item to be imported with quantity and C&F value.

2. Public sector importers

Public sector importers need to provide the following documentation: Attested photocopy of allocation letter issued by the allocating authority in favor of the concerned public sector agency specifying the source, amount, purpose, validity, and the terms and conditions; Attested photocopy of sub-allocation letter, if any, issued in favor of the importing agency or unit; Attested photocopy of sanction letter from the administrative ministry or authority where applicable; and A declaration by the authorized officer of the importing agency indicating the amount of utilized/unutilized government funds and that imported raw materials will not be sold.

3. Private sector importers

Private sector importers need to furnish the following additional documents: Valid membership certificate from the registered local chamber of commerce and industry or any trade association, established on an all-Bangladesh basis, representing any special trade or business; Proof of payment of renewal fees for the Import Registration Certificate (IRC) for the concerned fiscal year; Copy of a “TIN Certificate” issued by the tax authority. The TIN (Tax Identification No.) Certificate is a new requirement aimed at ensuring collection of income tax, VAT and other revenues from importers; A declaration, in triplicate, that the importer has paid income tax or submitted an income tax return for the preceding year; and Any such documents as may be required by import policy order or public notice, or instruction issued by the Chief Controller of Imports and Exports.

UTTARA MOTORS, A LEADER GROUP IN BANGLADESH:

Automobile market is a booming market in Bangladesh & Uttara Motors Ltd. is no doubt the market leader. Uttara Motors Ltd. is the largest automobile Seller, importer, assembler & distributor in Bangladesh. It has 12 brand by all or the country & more then 75 nos. dealers working under every branch Uttara Motors Ltd. covers a lot of famous brand, like “Isuzu” & “Suzuki” vehicle has been imported from Japan, “Maruti Suzuki”, “Bajaj”, “Swaraj Mazda” has been imported from India Pack Suzuki from Pakistan. An early research showed that the main products of Uttara Motors Ltd.

2-Wheeler – Bajaj

3-Wheeler – Bajaj

Cars – Suzuki & Maruti Suzuki

Jeeps – Suzuki & Isuzu

Microbus – Suzuki & Maruti Suzuki

Minibus – Swaraj Mazda & Isuzu

Pickups – Ravi & Isuzu

Bus – Isuzu

Trucks – Isuzu & Swaraj Mazda

Bajaj Motor Bike

Bajaj motorbike is the first Indian motorbike in the market of Bangladesh to offer quality bike to the customers. Therefore, it will enjoy the ‘first mover’ advantage in the market. It is likely to achieve middle and upper-middle class consumers’ preference and may capture the maximum market share. It also has the advantage of economies of scale, trend leadership to set the attributes of the product.

Uttara Motors Ltd is the sole distributor of Bajaj Auto has achieved highest market share in financial year, achieving 29% share had to face tuff competition. About number of 12 automobile companies are involved with Two-wheeler marketing and they are offering attractive package of price and features to their potential customers.

The main competition of Bajaj are Hero Honda, Yamaha, Honda Pak, Dayang etc and their market share is very closed to Bajaj. Beside these several number of Chinese Brands are available in Two-Wheeler market are achieved a remarkable market share. As a heist market share holder all of we have try to grip the share first position and try to increase it to 35% of total market.

Different Brand of Bajaj Motor Bike:

BAJAJ KB 4S/ ASPIRE

BAJAJ CHETAK

BAJAJ CALIBER CROMA

BAJAJ KB-125

BAJAJ CALIBER

BAJAJ LEGEND SCOOTER

BAJAJ CLASSIC SL SCOOTER

BAJAJ CLASSIC SS SCOOTER

BAJAJ BOXER – AT

BAJAJ BOXER – CT

BAJAJ KB 4S CHAMPIAN

BAJAJ BOXER

BAJAJ CLASSIC

BAJAJ KB RTZ

BAJAJ M-80

BAJAJ SUNNY

BAJAJ SUPER FE

BAJAJ SX ENDURO

BAJAJ PULSER

BAJAJ BOXER CT DELUX

BAJAJ BOXER AR

BAJAJ BYK

BAJAJ PULSER DTSI

Findings and Analysis:

I have conducted a questionnaire survey and the findings and analysis from the same are as follows:

Link Between Driven of Bajaj Motorbike and other Brand Motorbikes

In my finding that before using Bajaj motorbike most of the respondents use quality Japanese motorbike for 5 yrs or more than that. From the total respondents majority of them used 7-12 months of Bajaj motorbike. When bajaj introduced in the market, it’s started to attract those customer, and for its overall performance respondents replace it from their other type of motorbike. Normally researcher found that most of the respondents are using Pulser and Boxer AR.

Competitor

I have found that the majority of respondents used Yamaha and Honda, which are the major competitors of Bajaj motorbike. And those who used Yamaha and Honda they normally select pulsar of Bajaj motorbike, because of its look, fuel consumption, speedier and well designed.

Competitive Advantage

Obligation for non-availability of Japanese motorbike is the main reason of changing respondents mind to buy Bajaj motorbike. Objections for parts availability, services and dissatisfaction for fuel consumption are also the reasons of make the choice of Bajaj motorbike. But for the Bajaj Motorbike respondents ranked those attributes very good. Respondents who are using Bajaj motorbike, they like much better style, speedy, especially young peoples they like lucrative motorbike and Uttara motors are providing Bajaj motorbike in the market which can deliver all the need of recent customer.

Ranking attributes of Bajaj Motorbike

I have found in my findings that the design of Bajaj Motorbike as their 1^st choice, second choice as feature, fuel consumption as their third choice, durability as fourth choice, price as their fifth choice, brand image as sixth choice, spare parts availability as seventh choice and resale value as their eight choice. Most of the respondents use pulser and boxer AR motorbike. I have found that most of the respondents who uses pulser, their age level is 26-30. So majority respondent are young, they likely speedy motorbike and well design motorbike and majority education level is bachelor’s and their income level is 10,000-40,000 and most of them use their personal purposes.

I have found that spare parts are not available in the market though it is also an important factor while purchase a motorbike. So company needs emphasis on spare parts availability. It’s been clear from the analysis that most of the respondents are not satisfied with the price and they are very much pricing sensitive while they purchased any product.

Affordability to the Price of the Bajaj Motorbike

I have found maximum price of the Bajaj Motorbike is Pulsar-1,05,500.00 and lowest price of the Bajaj Motorbike is BYK-55,500.00. I have found that the majority respondents are not satisfied with the price. They claimed especially about the pulser, which is more expensive than the other brands of Bajaj motorbike. Those respondents used Honda or Yamaha. They bought it also with higher price at that period but Bajaj is an Indian motorbike and that’s why they feel its price should be keep low compare than Japanese reputed Brand Motorbike. Though Bajaj providing all the lucrative things that a bike needs but respondent are not happy with price. Those respondents are not happy with price; most of their age level is 26-30, Education level is Bechelor’s and their income level is 10,000.00-20,000.00 and most of they use their official purposes they want a price that is affordable for all customers. Though its price is high but people still select Bajaj motorbike because of the unavailability of Japanese Motorbike.

Reason to Choice of CC

I have found that from the total respondents 70, there are use different CC such as Boxer AR-100cc, Pulsar –150cc, Discover-125cc, Ct-100cc, Ct-100scc, KB-100cc and BYK-80cc. Most of the respondents use Pulasr-150cc and Boxer AR- 100cc. These two types of model server most of the modern facilities such as design, look, features, speedier, fuel consumption, and because those respondents who used well reputed brand motorbike like Honda or Yamaha, their expectation are high and to meet their satisfaction they have chosen these types of bike of Bajaj.

Post Purchase Behavior :

Satisfaction of fuel consumption.

I have found that from the total respondents 26 respondents uses Pulsar motorbike. It’s found that most of the respondents are satisfied with the fuel consumption of their bike. So the perceived benefit matches with their expectation at this particular issue. The other respondents who use other types of bike of Bajaj, they also satisfied with the fuel consumption of their bike. So overall almost all the respondents are satisfied with the fuel consumption of their motorbike.

Satisfaction of After Sales Service

From this report, I have found that 74.3% of the total respondents are satisfied with the after sales service of the company and from those respondents most of them users Pulsar which spare parts are not available in the market. So most of the respondent are satisfy to the after sell service. Uttara Motors offered 1 years service warranty but they should give more emphasis of their after sales service, so that they can provided better after sales service in near future. Because it’s becoming more competitive market, they must provide some competitive advantage. So that they can grow more customers and can maintain good customer relationship.

Availability of Bajaj Motorbike

I have found that availability of Bajaj Motorbike 62.9 percent respondents gave their positive opinion but 37.1 percentages were not satisfied for the availability while purchasing the motorbike. Because of Pulsar motorbike is not available in the current market.

Satisfaction of Existing Product

From this report, the researcher has found that from the total respondents 26 respondents uses Pulsar motorbike. And almost all of them are satisfied with their existing product. Where as, rest of the respondents who uses other types of bike, 9 of them are not satisfied with their existing bike. So the researcher can say that most of the bike especially pulsar and Boxer AR are quality bike. And it shows that companies are not concern about quality because they already provided quality bike in the market. That’s why most of the respondents the researcher found that they are satisfied with their existing motor bike.

Recommend to Others

The researcher has found from his research paper that almost every respondent except 5 consumers are willingly to recommend others to buy the motorbike. Most of the respondents said, according to Durability, Availability, Brand Image, Design, Feature, Fuel consumption were positive, that’s why researcher found that company provides quality motorbike in the market and so that consumer doesn’t hesitate to recommend others to buy the motorbike of Uttara motors that is Bajaj.

Comments expectation and suggestions given by respondents

Price of Bajaj motorbike is one unpleasant attribute that found by the survey research. Inaddition, after sales service, Parts availability, Gear frequencies are also the unpleasant characteristics that freely recommended by the respondents to the researchers. They want Pulsar-150cc and 180cc available in the Dhaka market. On the other hand researcher found that customers are happy with their motorbike as a product and with the fuel consumption of the motorbike. But most of the respondents claimed about the price that should be decrease in near future.

BAJAJ MOTOR BIKE SALES:

Year Sales Qty

1999 – 2000 6120

200 – 2001 7911

2001 –2002 10897

2002 – 2003 11100

2003 – 2004 12300

2004 – 2005 14597

Growth of Bajaj Motor Bike over last Six Year in Bangladesh

SUZUKI PASSENGER CAR:

Market overview:

At present the passenger car market of Bangladesh is having a steady growth rate and is on its way toward an increasing growth rate. In the back drop of increasing urbanization & greater mobility of people & for lack of well planned, systematic public transportation network, demand for cars in general & small size, economy cars in particular, would continue to increase.

At the moment a car, in general, is not viewed as a symbol of luxury, rather it is viewed as a symbol of safety, comfort & convenience. As th