Automobile Industry in Bangladesh

This article provides an overview of the automobile industry in Bangladesh, including the demand for vehicles, import trends, and investment initiatives by local and foreign companies. It discusses the challenges faced by middle-class earners in purchasing vehicles due to high taxes and the need for expanding heavy industry in the country.

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Introduction
Demand for transportation increases with an increase in development. Transportation is a
major industrial sector in an economy. Bangladesh has experienced economic growth and
increased rate of employment. The purchasing power rose with a rise in demand for
automobiles.to meet the increasing demand, the country depends on the imported automobiles
since it does not manufacture vehicles. There are a number of vehicles which are imported on a

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daily basis. The vehicles imported In Bangladesh come from countries like Japan, South Korea,
India, Germany, France, and Malaysia among others. Japan and India are the top sellers in the
country. With the aim of restricting the import, the government imposes taxes and this has made
it impossible for middle-class earners to purchase vehicles. The latter requires the companies that
manufacturer vehicles to look for ways for manufacturing vehicles at a relatively cheaper price.
Bangladesh needs to come up with ways of expanding heavy industry since the latter will
contribute to economic development. The development in the shipping industry is a clear
indication that there is potential for improvement for the other areas that are concerned with
heavy machinery.
Industry Overview
The country is making progress in most sectors that would lead to economic growth and
development. However, the country has not been active in the automobile sector .there has been
production of auto- rickshaws, three whether motor vehicles, Mishuk, and engine from Honda.
The country has been experiencing increased usage of vehicles and hence had to improve its
infrastructure. There has been an increased demand for vehicles due to improved living
standards.
Toyota has been experiencing increased sales of its products in Bangladesh even for
commercial vehicles. For the case of motorbikes, Indian brand Bajaj is the most popular. There is
however a state-run brand named Pragoti industries which have been manufacturing cars for the
Mitsubishi firm.
The Bangladesh market is attractive to both the local and foreign investors due to
increased demand for automobiles. Several foreign companies like Tata have started investment
initiatives in conjunction with Nitol Motors. The first car to be manufactured in Bangladesh was

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named Sobari meaning “for all.” the car was made in Jessore district and it costs 6 lakhs and 45
thousand taka. Everything else was made locally in Bangladesh apart from the Engine. Volvo
Group, a Swedish made giant also launched the Eicher brand and entered the commercial vehicle
market. The vehicles manufactured by Eicher are distributed by Runner motors limited which is
an arm of the runner group.
Another business conglomerate based in Chittagong singed a deal with the Malaysian
automobile manufacturers to manufacturer 1200 cars annually. The Company has invested TK
400 and employed enough workforces. Zinwa, BMG, & KRW from South Korea also launched
its automotive in Bangladesh in 2015 in collaboration with the Ena group. The SIAM hosted a
three-day show in Bangladesh so as to unite automotive industries in both Bangladesh and South
Korea.