Bangladesh would soon be able to meet 80 percent of domestic demand for motorcycles from local production as the ‘Motorcycle Development Policy’ recently announced by the present government would boost the emerging industry.
The policy, long-awaited by the industry people, has paved the passage for the growth of the industry and it has already encouraged most of the brands go for manufacturing two-wheelers.
Hafizur Rahman Khan, Chairman of Runner Automobiles Limited, a concern of the Runner Group said this in an exclusive interview with Deputy Managing Editor of the Bangladesh Post Golam Shahnee.
Runner Automobiles Limited is the pioneer and the lone manufacturer of automobiles in Bangladesh.
After establishing its dominance over the domestic market for two-wheelers, the local brand has already exported bikes in Nepal and Bhutan and has already made remarkable progress in making shipment of ‘Made in Bangladesh’ tagged bikes in a number of African and other countries.
Referring to the recent development in the country’s automobiles industry, the leading entrepreneur in the sector Hafizur Rahman Khan said, due to lack of a policy, the industry failed to make desired growth during last many years.
With announcement of this policy, many investors, both local and foreign, would be encouraged to inject large funds in setting up motorcycle manufacturing plants as well as developing vendors for making spare parts, he added.
Giving an encouraging picture of investment needs, this legendary entrepreneur who is leading the domestic motorcycle industry for a decade, said at present the motorcycle industry has prospect for annual business turnover worth Tk 5,000 crore, where local as well as foreign investment can be injected.
“Development of vendors is a much essential part for growth of the motorcycle industry,” he said.
“If vendors are developed in adequate number here to manufacture spare parts and accessories, then the costs for production of motorcycles would come down which would make positive impact on enhancement of sales,” he said.
“Besides, the locally manufactured spare parts and accessories could be exported to neighbouring and other countries thus bringing huge foreign currencies in the country,” Hafizur Rahman Khan added.
Not only new ventures, the existing vendors in Japan, Thailand, Malaysia and even India would prefer relocating their plants in Bangladesh taking the advantage of the new ‘Motorcycle Development Policy, as the government has offered a number of preferential benefits for the local manufacture of two-wheelers, he mentioned.
“Besides duty facilities for manufacture, the government has offered 10 percent cash incentives for export of motorbikes,” he further said.
Bangladesh Post: How do you evaluate the just-announced Motorcycle Development Policy?
Hafizur Rahman Khan: I must congratulate the present government for announcing the policy. There was no policy support for motorcycle industry. The policy has now been announced – it was our long-awaited demand. In the policy, manufacturing of motorcycles by all brands who are marketing here has been made mandatory. This is what I was demanding since a long. This would curb country’s dependency on imports. Those engaged with automobiles business now has already taken move to produce bikes in the country by setting up factories here. Almost all brands would be able to start manufacturing bikes in the country.
Bangladesh Post: What is the size of annual turnover in motorcycle business in Bangladesh you guess? What steps need to be taken to enhance investment in the industry?
Hafizur Rahman Khan: The policy would encourage development of vendors in the country. This would facilitate growth of small industries here. Some vendors would manufacture chains, while some would make seats, headlights and various other spare parts and accessories. Besides small enterprises, there is scope for big investment in manufacturing of accessories. Annual turnover of motorcycle market is Tk 5,000 crore where the size for vendor investment would be up to Tk 3,000 crore.
Bangladesh Post: What growth prospects do you for the industry in the next year?
Hafizur Rahman Khan: About 4 lakh motorcycles were sold in the local market last year. The number may cross five lakh units level by the end of this fiscal year, I hope. The local motorcycle industry has made 20-25 percent business growth over the last three years. Runner has been able to increase its market share substantially.
Bangladesh Post: What response Runner is receiving from Nepal and Bhutan markets?
Hafizur Rahman Khan: Runner is doing very well in export market. The Bangladesh brand Runner is going to take part at Dubai Auto Show next year. After Nepal and Bhutan, we are going to export Runner bikes in a number of African countries.
Bangladesh Post: Runner has got government’s approval for manufacturing high-end bikes. When are you going to manufacture those?
Hafizur Rahman Khan: For the first time in the country, Runner has secured approval for import of raw materials for manufacturing 165CC-500CC bikes for exports. We are hopeful to start production of those high-end bikes in the next year. Those bikes will be exported to the countries wherever there is demand for those.
Bangladesh Post: Please share your experience on customers’ satisfaction. Please also elaborate the commencement of Runner business.
Hafizur Rahman Khan: Runner is always sincere in attaining customers’ satisfaction by giving them most innovating and high standard products as per their needs. Runner started manufacturing bikes locally in 2007 by producing spare parts. The company secured government recognition as a motorcycle manufacturer in 2011 through setting up various units like punching, welding, painting, assembling, testing and other formal set ups. We emerged as a full-fledged motorcycle manufacturer in 2012 and started full production of two-wheelers in Bangladesh. As a ISO certified company, Runner is a fully compliant industry. This fully environment-friendly ‘green industry’ is situated over 40 acres of land at Bhaluka in Mymensingh.
Bangladesh Post: Ride sharing service has put positive impact on sales of Runner bikes. Please share your observation.
Hafizur Rahman Khan: Ride sharing companies have made positive impact on sales of bikes. We have signed agreement with ‘Pathao.’ Their riders would enjoy special facilities for purchasing Runner bikes.
Bangladesh Post: What obstacles does this industry face?
Hafizur Rahman Khan: Like other countries like India and China, import should also be discouraged in Bangladesh. For this, the government should continue its support for manufacturing of motorcycles. Registration fee is still higher compared to other countries. For registering a bike worth Tk 1.10 lakh, the cost of registration is Tk 21,000, whereas in other countries the fee is Tk 5,000 only. The government should immediately bring down the registration fee for smooth growth of the industry as it generates huge employment and generates income to a vast population directly and indirectly involed with the sector.
Bangladesh Post: Please make an outline about the future plan of Runner.
Hafizur Rahman Khan: Since its inception, Runner was sincere to improve the quality of the products and we have been successful in enhancing the standard of bikes. I dream of the day when most of the bikers would ride on Made in Bangladesh tagged two-wheelers. And most of them would ride on Runner motorcycles.