Chairman's Review - Indus Motor Company Ltd.

Weld Line 

INDUS MOTOR COMPANY LIMITED 

Annual Report 09 

20 

Chairman’s Review 

I welcome you all to the 20th Annual 

General Meeting of your Company and it is my 

pleasure to present to you the Company’s 

performance for the year ended June 30, 2009. 

Ali S. Habib 

Chairman 

21

Automobile Industry 

In 2008-09 the global automotive industry 

witnessed its worst slowdown amidst dramatic 

financial crises worldwide. The year also turned 

out to be an extremely turbulent one for Pakistan 

due to its weak economy and deteriorating political 

and security situation. Like all other automakers, 

Indus Motor Co., was adversely impacted by these 

extraordinarily difficult conditions. 

The ongoing global economic crisis, negative 

security developments and continued power 

shortages slowed Pakistan’s real GDP growth to 

2% for 2008-09 compared to 5.8% achieved in 

the prior year. Overall economic activity weakened 

despite growth in agriculture, while declining 

imports and slowing domestic demand resulted in 

lower tax revenue. The first half of the year was 

particularly severe as commodity prices peaked 

and Pak Rupee fell against all major currencies 

giving rise to headline inflation of 25%. Interest 

rates soared and tight monetary policy limited 

availability of credit leading to loss of consumer 

EXCHANGE RATE (RS.) 

EXCHANGE RATE (RS.) 

80.50 

76.50 

72.50 

0.88 

0.84 

0.80 

0.76 

0.72 

0.68 

$ To Rupee Movement 

68.50 

Jul-08 A S O N D J F M A M Jun'09 

Yen To Rupee Movement 

0.64 

Jul-08 A S O N D J F M S M Jun'09 



22 

confidence. The situation started to ease during 

the second half of the year following the 

intervention of the IMF support program. 

The large scale manufacturing sector recorded a 

dismal performance with a decline of -8.2% 

compared to 5.4% growth for the previous year. 

In the automotive sector, sales of locally assembled 

passenger cars (PC) and light commercial vehicles 

(LCV) which had earlier between 2001-07 posted 

sustained annualized growth of 28% plunged by a 

record 47% to 99,307 units compared to 187,412 

units sold in 2007-08. 

up to 800 cc 

1000 cc 

1300cc~2000cc 

LCV 

Units 

Sales of locally produced Passenger Cars 

and LCVs 

152,365 

2004-5 

23% 

187,436 

2005-6 

9% -8% 

204,212 

2006-7 

187,412 

2007-8 

-47% 

99,307 

2008-9 

In addition to the economic downturn the auto 

industry also had to deal with the challenges posed 

by the imposition of additional levies and taxes in 

the Federal Budget 2008-09 which included the 

5% Federal Excise Duty on cars with engine 

capacity in excess of 850cc and application of 

fixed slabs of withholding tax at the registration 

stage. This compounded the situation resulting in 

a sharp increase in automobile prices and 

dampening of demand. Post budget imposition of 

35% cash margin on letters of credit further 

aggravated the liquidity situation for the auto sector 

before it was withdrawn several months later. 

The industry faced a sharp decline with resultant 

production cut backs and job losses. We appreciate 

the government efforts to reduce the depreciation 

allowance on used imported vehicles from 2% to 

1% per month during the year. This positive step 

by the government provided a much needed relief 

to the industry and used car imports slowed to 

6,524 units for the year compared 13,145 units 

for 2007-08. The current policies on used cars in 

Pakistan are still extremely liberal when compared 

to India, Thailand and other countries and are often 

misused by importers under transfer of baggage 

scheme. 

The Federal Budget 2009-10 brought some hope 

for the auto sector that struggled for survival during 

23 

the past year. Removal of 5% Federal Excise Duty 

on cars with engine capacity in excess of 850cc 

is a welcome step by the Government of Pakistan 

towards the revival of the industry. There are some 

signs of turnaround with stronger demand recorded 

during the first quarter to September 2009. 

Auto industry is considered the mother of all 

industries and a key driver of the economic growth, 

technology transfer and job creation. There is still 

a lot of untapped potential in Pakistan's auto market. 

Proper implementation of government policies and 

measures to improve the market situation and 

consumer demand are required. Regulators and 

the Government of Pakistan need to revive the 

auto sector and ensure that this vital sector of the 

engineering and LSM industry remains active and 

growth-oriented as in the past. 

To revive the auto industry several steps are 

necessary which include: downward revision in 

withholding tax slabs at registration stage, greater 

restriction on used car imports, reviewing 

localization requirement, revisit Auto Industry 

Development Program (AIDP) and initiate a dialogue 

with all stakeholders for renewed implementation 

of AIDP, removal of Federal Excise Duty on Royalty 

and Technical Fee and consultation with industry 

on Free Trade Agreements/Regional Trade 

Agreements, particularly the Afghan Transit Trade.

Company Review 

Despite the unprecedented challenges posed by the 

deteriorating economic environment, and general 

uncertainty in the country which contributed to weak 

customer sentiment and significantly less demand for 

automobiles, your Company was able to out perform 

the market and post impressive results under these 

severe circumstances. 

Sales 

While, the automobile demand for PCs and LCVs crashed by 47% in 2008-09 over the previous year, 

we were able to increase our market share from 25% to 32% during the same period and achieved 

market leadership position in the second half of the year. 

CKD Passenger Car Small-High Segment 

The new generation Corolla specifically designed to appeal to 

increasingly savvy customers who value fuel efficiency, technology 

and aesthetics was launched in August 2008. It has been very 

well received throughout the country and though the segment 

declined by 24% and our own volume fell 20% during the year, 

mainly on account of run out of the previous Corolla and gradual 

ramp up of the new model, yet the Company was able to increase 

its market share selling 26,760 Corolla vehicles in the declining 

market. 

CKD Passenger Car Economy Segment 

The economy segment was particularly hard hit with a volume 

drop of 60% over the prior year due to the high interest rates 

environment and the credit squeeze by financial institutions. 

Daihatsu Cuore volume also fell 52% but it was able to grow its 

market share by 4% in a declining market. During the year a new 

colour ‘Wildfire Red’ was added to the Cuore palette which 

attracted healthy customer response. 

CKD Light Commercial/Pickup Segment 

LCV sales plummeted 61% during the year. Despite losing 23% 

in volume, the Hilux was able to double its market share to 45%. 

The vehicle offers great value and leading performance for 

transporters, fleet users and is also appreciated by the urban 

customers. 



24 

Units 

Units 

Units 

Competition Corolla 

50,824 

17,184 

34% 

33,640 

66% 

2007-8 

-24% 

Competition Cuore 

47,730 

35,526 

74% 

12,204 

26% 

2007-8 

-60% 

Competition Hilux 

8,849 

6,848 

77% 

2,001 

23% 

2007-8 

-61% 

38,755 

11,995 

31% 

26,760 

69% 

2008-9 

19,273 

13,421 

70% 

5,852 

30% 

2008-9 

3,417 

1,883 

55% 

1,534 

45% 

2008-9 

CBU Segment 

The market was extremely turbulent for high end vehicles where 

custom duty on cars with engine capacity in excess of 1800cc 

increased from 90% to 150% during 2008-09. The segment 

which is dominated by Toyota brands like Camry, Hilux 4x4, 

Hiace, Coaster vans and SUVs – Land Cruiser and Prado declined 

by 59%, though the Company continued to retain leadership 

with 75% of the market share. 

The combined sales of Toyota and Daihatsu brands 

of both CKD and CBU for the year ended June 30, 

2009 declined by 31% to 35,276 units compared 

to 50,802 units sold for the same period last year. 

Business of Toyota Genuine Spare Parts remained 

robust during the period. Overall, the Company 

sales revenue for 2008-09 decreased by 8.6 % to 

Rs 37.9 billion, compared to Rs 41.4 billion achieved 

in the prior year, while pre tax profit decreased by 

42.2 % to Rs 2 billion compared to Rs 3.5 billion 

for the year 2007-08. 

The severe economic challenges of 2008-09 had 

a significant impact on our results for the year in 

terms of lower sales, shrinking margins and reduced 

cash flow. Our first half year results were affected 

by increase in market prices for the products due 

to additional duties and taxes, while depreciation 

of the rupee further compounded the problem with 

rapid rise in input costs thus adversely impacting 

the demand. 

Fortunately, the Company aggressively embarked 

on a program to eliminate waste, lower inventories, 

improve work efficiencies, reduce costs and retrain 

workforce before the market meltdown truly hit 

Mr. Koji Hyodo appointed Vice Chairman 

Mr. Koji Hyodo took over the office of the Vice Chairman IMC effective 

January 1, 2009. Mr. Hyodo who had earlier, in mid 2008, transferred 

from Toyota Motor Corporation to IMC was serving as Advisor to Vice 

Chairman and was elected as a director to the IMC Board at an Extra 

Ordinary General Meeting in October 2008. Mr. Yutaka Arae, the outgoing 

Vice Chairman was appointed as Advisor to the Chairman effective 

January 2009. 

25 

the industry. And we are continuing to take decisive 

actions to become lean and efficient. We expect 

these initiatives will contribute significantly to 

overall growth and profitability when the economy 

rebounds. Many of these actions benefited the 

Company during the second half of the year with 

impressive results in the last quarter despite a 

difficult environment. 

Dividend 

Units 

Competition IMC CBUs 

5,308 

581 

4,727 

89% 

2007-8 

-59% 

2,159 

1,616 

75% 

2008-9 

The Directors are pleased to propose a final 

dividend of 100% i.e. Rs 10 per share which is also 

the total payment for the year as no interim dividend 

was announced mid year. An amount of Rs 599.1 

million is recommended for appropriation to the 

General Reserves which will be utilized for 

continuing growth and capacity expansion. 

Contribution to the National Exchequer 

In 2008-09 Indus Motor contributed an impressive 

Rs 14.2 billion to the national exchequer which 

amounts to 1.2% of the total revenue collection 

by the Government. Over the last 10 years the 

Company’s contribution stands at Rs 88.5 billion. 

543 

Mr. K. Hyodo (R) receiving a 

symbolic baton from Mr. Y. Arae

Marketing 

Realizing that 2008-09 will be a tough year for Pakistan, 

particularly the auto industry, our Marketing Division 

adopted aggressive strategies. 

With support from all stakeholders, including our 

vendors and dealers, we maintained steady control 

over this turbulent ride and were able to perform 

better relative to the competition. 

Corolla is a brand that almost every Pakistani 

recognizes and yearns to own. It has been a market 

leader in its class ever since its official introduction 

in Pakistan. As a result, almost every year Corolla’s 

sales in Pakistan are the highest among all ASEAN 

countries and this continues again in 2009. 

Following the successful launch of Corolla with the 

technologically advanced Altis in August 2008, we 

introduced its 1300cc and Diesel variants later in 

October 2008. The 1.3 L Corolla series comes with 

a new VVTI engine and ABS in case of GLI. These 

features are contributing positively to our total 

Corolla volumes. 

As the price gap between petrol and diesel 

narrowed, the sales of our Diesel variants saw a 

decline. However we are educating our customers 

Mr. Akira Okabe, Senior Managing Director, TMC, addressing 

the gathering at the New Corolla Launch Ceremony 



26 

regarding the better mileage of diesel vehicles 

compared with petrol and we hope diesel sales 

pick up in the next fiscal year. 

Daihatsu Cuore is a premium product in the 

800cc category which has excellent performance 

and durability. Maintaining popularity in its category, 

its market share increased despite a decline in 

segment volume. 

Post successful launch of Hilux 4x2 in November 

2007, we achieved another milestone by the 

development of its variant. The Hilux 4x2 was 

converted with a canopy at the back and made 

into a variant called the 'Hilux Grand Cabin'. This 

variant specifically has a more spacious cabin now 

with dual air conditioning that gives it a car-like 

comfort and has reverse parking sensors for better 

and safe parking. Suitable mostly for rough terrains 

and mountainous areas, the Hilux Grand Cabin has 

been received very well by customers. 

In order to cater the needs of our growing 

Newly launched Hilux Grand Cabin 

customers, we expanded our 3S dealership network 

to 31, with two new additions - Toyota G.T. Motors 

in Islamabad and the Toyota Shahrah-e-Faisal 

The newly established Toyota G.T. Motors in Islamabad 

27 

Motors in Karachi. In future Inshallah additional 

dealerships will come up in Bhawalpur, Sahiwal, 

Sukkur, Faisalabad and in other major cities. 

Sales Conference 2009 

A Nationwide Sales Conference for 

our dealership sales staff was 

organized for the first time at Indus 

to enhance and improve their selling 

skills and evaluate their product 

knowledge. The conference was an 

interactive event, comprising of 

games, quizzes and incentives for 

the winning sales people. A 6-point 

walk was done to test the product 

knowledge of the sales staff. Due to 

the instant popularity this event 

received, it is now going to be a 

regular event at IMC.

Spare Parts 

Our Spare Parts business continued its robust growth 

trend by achieving another sales record of Rs 1.5 billion 

up 9% over the previous year. This has allowed IMC to 

maintain its leadership position in this area in Pakistan. 

Increasing customer awareness for genuine Toyota 

Spare Parts was the priority for last year, which 

we continued through specifically designed 

advertisements in print and electronic media. 

However the issues of under invoicing and 

smuggling of parts continues and is damaging 

genuine parts suppliers. Corrective measures for 

valuation are still missing for imported parts. We 

have become an active member of the Anti 

Counterfeit and Infringement Forum and have hired 

the services of a third party to conduct raids on 

non-genuine parts suppliers to protect our name 

from ill repute, and in this we have achieved some 

success. We still need to make further headway. 

The price gap between genuine imported parts 

versus parallel or gray imported parts has reduced 

after implementation of GST at insurance 

companies following the recent budget 

annoncement. This is a positive step and will help 

the government increase its revenue. 

Mr. Tariq Cheema, Sr. Manager Parts receiving a memento from 

the Prime Minister 



28 

International Intellectual Property Rights Day was 

observed in Islamabad on April 27, 2009 and IMC 

made a presentation highlighting the problems 

faced by Gray Imports, valuation issues and 

smuggling, including suggestions to improve the 

situation with the assistance from the government. 

The event was appreciated by all concerned. 

The Customer Satisfaction Marketing Innovative 

Marathon (CSMIM) was held on April 17, 2009, 

with an aim to enhance customer satisfaction 

through innovative marketing ideas and strategies. 

The concept revolves around using the Plan > Do 

> Check > Act (PDCA) cycle to achieve 

improvement in dealers’ business profitability and 

customer satisfaction. IMC’s after sales team 

supported the dealers in selecting a CSMIM theme 

for enhancing their after sales business. The grand 

finale of CSMIM was held in Karachi. 

Spare Parts Sales (Rs in million) 

759 

15% 

2004-5 

875 

27% 

2005-6 

27% 

1,112 

2006-7 

1,411 

2007-8 

9% 

1,543 

2008-9 

Service 

The focus on after sales services continues 

to increase with the rising number of Toyota 

and Daihatsu vehicles in Pakistan. 

Mr. Chihiro Atsumi, Ambassador of Japan, IMC Management and guests on the 3rd T-TEP Launch at CTTI, Islamabad 

Following the signing of the After Sales Service 

Mid Range Plan a number of activities have been 

undertaken to upgrade service operations, prepare 

for business growth and to provide high quality 

and consistent after sales service to our valued 

customers. Our aim is to get our Service 

department recognized throughout the Toyota 

affiliates. 

With our continued commitment to enhance the 

level of technical education in Pakistan and to 

cater to the needs of the northern region of the 

country we selected the Construction Technology 

Training Institute (CTTI), Islamabad to launch the 

3 rd Toyota Technical Education Program (T-TEP) 

on February 20, 2009. We are confident that 

T-TEP graduates from this institute would prove 

highly productive for IMC, Toyota dealers and Auto 

industry vendors. 

29 

To enhance the technical and management skill 

level and create a competitive environment for 

dealer’s service staff, a National Skill Contest for 

Winners of Service Skill Contest 2009

General Technicians, Service Advisors and Paint 

Technicians was organized on June 12, 2009. 

Express Maintenance 

Following the successful Express Maintenance 

(EM) launch at Toyota Defence Motors on 

December 2007, Toyota Faisalabad Motors was 

the second Dealership, the first in Punjab, to offer 

this facility to its valued customers. EM is a 

successful concept for providing speedy after 

sales service in just 60 minutes from reception to 

vehicle delivery. 

Toyota Faisalabad Motors & IMC Management during Express Maintenance launch 



30 

One of our largest 3S dealerships by sales, Toyota 

Central Motors was also certified for EM by Toyota 

Motor Corporation (TMC)’s Kaizen team on 

June 26, 2009 by scoring an impressive 97%. 

This is another addition to Toyota Customer Service 

Workshop Management (TSM) Advance Club, which 

would cater for the growing needs and 

expectations of our valued customers by adding 

value to our after sales business and enhancing 

customer satisfaction. TCM will shortly be 

inaugurating their EM through customer launch. 

Service facility at Toyota Central Motors 

31

Customer Relations 

Our Customer Relations (CR) function continued 

its journey towards meeting and exceeding 

customers’ expectations and ensuring their 

experience is an enjoyable one. 

We strived for full compliance with Toyota 

Philosophy of Customer First during the year. 

Upgraded CR performance standards were 

introduced to facilitate customer management. 

These focus on motivating our dealers to create 

their own vision, mission and strategy specifically 

in Customer Retention, supported by customer 

friendly policies and procedures for attaining the 

highest levels of Customer Satisfaction and also 

raising the bar in CR operations and achieving 

Toyota’s CR Global standards. 

To further enhance customer satisfaction of existing 

and new customers, CR introduced online 

Customer Satisfaction Index (CSI) and Service 

Satisfaction Index (SSI) forms, which are compiled 

and analysed at respective dealerships on a regular 

basis. 

On a quarterly and annual basis we conducted CR 

Regional Workshops and Voice of Customer (VOC) 

Refresher Courses. We also shared Best Practices 

within the network’s CR teams for enhancing Skills 

and Competencies. Our dedicated CR team 

conducted CR Assessments at all dealerships to 

monitor the successful implementation of Toyota’s 

CR Global Standards and to evaluate CR 

performance. 

The top performing CR Managers are recognized 

by IMC and Dealer Management by taking them 

to a Learning Trip to a Toyota distributor abroad 

for transferring Best Practices to our network. 



32 

An Initial Quality Field Survey (IQFS) was conducted 

for customers at our dealerships, in which a 

customer satisfaction level of 94% was achieved, 

which speaks of our commitment to our customers. 

In this activity our team directly interviewed 346 

customers across Pakistan and recorded their 

feedback for bringing Kaizen (improvements) in 

our products and processes. 

Our CR vision for 2009-10 is to increase the rate 

of Customer Retention, to achieve the highest rate 

of responsiveness for inbound and outbound calls 

of the Customer Assistance Centre in line with our 

ultimate goal to achieve complete Customer 

Satisfaction. 

CR team during learning trip to Toyota UMW, Malaysia 

Operations 

This year distinctively we were being 

driven by demand. 

There was increased focus and attention on 

improvements in operations, especially for the 

new Corolla and ramp up to full production in the 

earlier part of the fiscal year. In line with the 

reduced market demand our production 

achievement for the year was 34,298 units. In 

accordance with Toyota’s Philosophy of employee 

retention without reducing the production units 

per day or building inventory, we provided 

extensive trainings to all team members during 

non-production days. 

We are thankful to Toyota Motor Corporation and 

Toyota Motor Asia Pacific (TMAP) for their continued 

support in all production areas. The efforts also 

led us to create IMC history, by crossing the 

milestone of 300,000 vehicles produced in our 

plant since inception. 

We were also able to complete Phase 1, Step 2 of 

Press Shop, which added five more major parts 

like floor and fenders to Press Shop operations. 

Our Production Engineering department 

successfully implemented Reverse Osmosis (R/O) 

system, which will help us to reduce costs by 

effective utilization of ED paint in our paint shop 

process. 

During the fiscal year 2008-09, the major task for 

our QA & QC department was to stream line the 

quality of the new Corolla. Alhamdolillah the 

outstanding feedback from the market says it all. 

The quality of the new Corolla surpasses all 

previous models both in the areas of design and 

process quality as evident from Initial Quality Field 

Survey conducted by our team at dealerships all 

over Pakistan. 

The quality of the car was also assessed by TMC 

SQA team which confirmed that the Quality level 

of the new Corolla is as per Global Toyota Shipping 

Quality Standards. 

33 

Mr. Hameed Ullah Jan Afridi, Federal Minister for Environment, 

receiving a memento from Mr. Ali S. Habib, Chairman, IMC 

For the last few years our focus has remained on 

inventory reduction, 5S, Safety, Supplier Quality 

and timely deliveries. To this end we have 

successfully implemented KANBAN tagging on 475 

parts, which will reduce inventory piling and ensure 

on time deliveries. All these activities were assured 

by regular process audits driven by IMC employees. 

We continue to work to strengthen our supplier 

base. Our Annual Suppliers Convention was held 

in May 2009, with the theme 'Peaks & Valleys'. 

Federal Minister for Environment, Mr. Hameed Ullah 

Jan Afridi was the Chief Guest at the Convention. 

The event highlights the localization efforts of part 

vendors and enables sharing of current challenges 

and future strategies. Performance based awards 

were presented to suppliers. 

During the year our Product Development 

department made notable progress in our vendor 

quality improvement programs. With strong support 

from our staff, initiatives on localization were 

undertaken in a timely manner, which are part of 

a future strategy designed to reduce cost and 

improve quality. 

IMC along with TMAP, TMC and other Toyota 

affiliates is working ceaselessly to make our work

place Safer, Healthier and Environment friendly. To 

achieve these objectives we focused on launching 

activities and engaging all employees to make them 

aware of issues pertaining to Safety, Health and 

Environment and how to implement these in our 

workplace. 

Safety is a high priority at Indus and a number of 

in-house trainings - safety drills, fire fighting drill, 

contractor's safety precautions and first aid training 

sessions were conducted during the year to create 

awareness amongst not only our staff but also 

contractors and sub-contractors and inculcate a 

safety mindset. Techniques have been introduced 

and a significant numbers of training man hours are 

being utilized to improve our Lost Work Day Injury 

Rate (LWDIR) which has reduced over the years. 

We at IMC always aspire to be at the forefront of 

activities that preserve and improve our 

environment. Our team is committed to continuously 

improve the company’s environment management 

Mr. Mitsuhiro Sonoda, the incoming 

President of TMAP, who has regional 

responsibility for Engineering, 

Manufacturing and Marketing, came to IMC 

on August 29, 2009. Mr. Sonoda praised 

IMC on increasing its market share in 

2008-09, despite the current industry 

downturn. He reiterated Toyota’s ongoing 

commitment and support to IMC and 

acknowledged the skills and efforts of the 

IMC team for building quality cars. 



34 

system to identify and avoid those activities that 

have negative environmental impacts and comply 

with all applicable legal, regulatory and other 

requirements, thereby assisting society by making 

the environment friendlier. We celebrated June 09 

as the environment month with the theme of ‘Stop 

Global Warming’. To reduce the levels of Volatile 

Organic Compounds (VOCs) we are continuously 

monitoring their levels and implementing Kaizen 

activities. A dedicated group of people are also 

working with result oriented plans for energy 

conservation. Other activities undertaken to ensure 

environmental compliance include incineration of 

paint sludge. Further, our new Corolla engines are 

in compliance with NEQs, which also include noise 

pollution standards. 

In order to provide employees the basic knowledge 

and to enhance their awareness on health, hygiene 

and healthier lifestyle, Indus Motor earmarked August 

2009 as the Wellness Month. The idea was “Health 

for All”. 

Indus Motor Company (IMC) held its 15 th 

Annual Kaizen Convention at the Karachi 

Expo Centre in July 2008. During the full 

day event 14 presentations were made by 

various Kaizen teams including those from 

IMC Vendors and Dealers. The First Prize 

went to the team, “Environment Friends” 

from the Paint Shop for process modification 

to reduce Volatile Organic Compounds. 

Amongst Vendors and Dealers, Toyota 

Faisalabad Motor’s team, ‘Ferocious Resolve’ 

got the first prize for their Kaizen activities 

in Warehouse Management. 

Engine Assembly 

35

Human Resource Development 

In 2008-09, the frameworks for helping employees 

develop their personal and organizational skills, 

knowledge, and abilities remained the top priority 

for our HR department. 

Cumulative Training Man hours 

767,346 

2004-5 

886,521 

2005-6 

998,137 

2006-7 

1,135,505 

2007-8 

1,250,825 

2008-9 


Manpower increase versus production (’000) 

Manpower Production 

In the difficult time for the auto industry, we were 

committed not to layoff a single employee from our 

Toyota Family and the focus was kept on employee 

training, utilizing the non-production days for 

development. 

In 2008-09, we crossed 1.25 million cumulative 

training man hours. The trainings ranged from 

fundamental skill training for production members 

to refresher courses on Toyota Production System 

(TPS), Kaizen, 5S and managerial skills. 

Experiential learning based leadership and team 

building trainings were provided to the company’s 

senior and middle management at Rani Kot Fort in 

the interior of Sindh and Galiyat in the north of 

IMC Management at Leadership Adventure Training 

34.9 

1,429 

2004-5 

41.6 

1,632 

2005-6 

47.8 

1,841 

2006-7 


48.2 

2,030 

2007-8 

34.3 

1,893 

2008-9 

36 

Pakistan. The trainings helped reinforce the strong 

one team one aim culture at IMC, besides providing 

an opportunity to the participants to analyze their 

leadership skills in uncertain conditions. 

The Apprenticeship Training Program successfully 

continued in 2008-09, with around 200 apprentices 

inducted during the year, taking the total number to 

over 700. 

While maintaining a strong working relationship with 

our staff and union, the Union Agreement (CLA) was 

signed in record time for the next 2 years. 

In line with our spirit of being a caring employer, the 

Education Assistance Program for our employee’s 

IMC in-house Skill Contest 

children was added to the various Employee 

Assistance Programs already in place like emergency 

medical assistance, Hajj scheme, etc. all of which are 

aimed at supporting employees in their hour of need 

as a part of the Indus family. 

Our recent ICT’s 

Ali Damani (Marketing Division) 

“TMAP is the ultimate learning resource, where jewels of knowledge and expertise are 

collected and distributed from and to all advanced and developing countries managed 

by TMAP. Hence my goal here is to learn and bring back that ultimate experience and 

knowledge gained from working with regional experts and TMC's/ TMAP’s management”. 

Syed Shabbir Uddin (Marketing Division) 

“Toyota values are the key drivers that made the company #1 automobile company 

in the world. In addition to functional knowledge, I have learnt values such as Kaizen, 

Genchi Genbutsu (going to the source), teamwork, consensus building and respect 

for people. I’ve seen drastic change in my performance and work style and am 

determined to contribute to IMC’s growth by transferring these skills and knowledge 

to my colleagues”. 

Wali Muhammad (Production) 

“I worked in TMAP-EM PE during 2007-9 as Project Manager. During this period I got the 

opportunity to learn Project Management activities through APMC projects and was fully 

involved in Projects from the start (especially 301L Corolla). I prepared Project Management 

Manual utilizing 301L Corolla project experience which will serve as a reference and guide 

for production preparation activities in IMC. My learning’s would help IMC to better 

understand TMAP, TMT and APMC regional operations and support systems”. 

Kashif Akhlaq (QA & QC) 

“It was only during ICT that I got real work experience. I was exposed to practical scenarios, 

which have helped me in implementing good practices in IMC. My learning of IMVI and 

242L helped my colleagues and team members in successfully handling quality issues. 

After returning from ICT I have tried to pass on my knowledge and learnings to my team, 

so that we can work for upcoming projects”. 

37 

Regular communication sessions are held with 

employees at all levels. Last year also several sessions 

were held including briefing on challenges faced in 

current market environment, gender diversity, etc. 

To enhance the motivation of our skilled Team 

Leaders and Team Members, IMC initiated 

an In-house skill contest for Weld, Paint, Assembly 

and Quality departments. The contest resulted in 

increasing the competitive environment on the 

production line. Winners were sent to Thailand to 

participate in the Asia Pacific skill contest, where one 

Team Leader from Pakistan secured a bronze medal. 

To improve learning and for better co-ordination 

with our overseas affiliates some of our employees 

are sent for 2 to 3 years to other Toyota affiliates as 

Inter Company Transfers (ICTs). Currently we have 

7 ICTs abroad and for the first time we have sent 

ICTs from the Marketing Division to Toyota Motor 

Asia Pacific (TMAP) in Singapore.

Corporate Social Responsibility 

Our CSR policy and philosophy, takes a holistic approach 

to engage all our stakeholders. We aspire to demonstrate 

responsible corporate conduct throughout the entire 

spectrum of our business operations. 

We aim for both business competitiveness and 

social development to achieve corporate social 

integration. It is important that as our business 

grows, our stakeholders’ interests are safeguarded. 

Indus Motor as a member of the UN Global Compact 

(UNGC) understands its responsibility towards the 

UNGC principles addressing Human Rights, Labor 

Standards, the Environment and Anti Corruption. 

We submitted our Communication on Progress 

(COP) in 2007 and are proud to inform that we 

were amongst the notable COP’s worldwide in the 

very first year. 

Through our CSR program with the slogan, 

"Concern Beyond Cars", we have contributed over 

150 million in the past 5 years on focused, 

prioritized, sustainable and high social impact 

initiatives that intersect with our company’s 

competitiveness and core competencies. Our CSR 

initiatives are in the areas of Road Safety, Technical 

Education, Environment, Health and Community 

Welfare, thus playing a significant role in the 

communities where we operate. The Company 

10,455 

Passenger 

20,678 

Pedestrian 

2,587 

Driver 


4,361 

Unknown 


57,114 

Rider/ Pilion Rider 

38 

budgets 1% of Profit before Tax for CSR 

Contributions. 

As a leading Company in the automobile sector, 

we have undertaken several initiatives in the field 

of Road Safety to create awareness in society of 

this important social issue, reduce traffic accidents, 

and help create a safe environment for all road 

users. Our Road Safety initiatives include the Road 

Traffic Injury Research Project, our flagship project, 

which is a public-private partnership with JPMC, 

NED and AKU, provides relevant and accurate data 

for evaluating the nature, location and magnitude 

of road accidents in Karachi. This useful data has 

been utilized by various stakeholders such as 

Hospitals, Traffic Engineering, Traffic Police, 

Government, NGOs, etc. to make improvements in 

Karachi’s traffic and reduce the number of road 

accidents. 

We also organized the 2 nd National Road Safety 

Conference in partnership with Shell Pakistan, AKU, 

RTIRC and SEF on July 7, 2009 at the Aga Khan 

University which brought together the relevant 

stakeholders to have a dialogue on how to reduce 

Traffic Injuries and Deaths for 

each Road User Group (Sept 06-Jul 09) 

Total Injuries and Deaths: 95,195 

Federal Minister of Communication, Dr. Arbab Alamgir Khan 

with steering Committee NRSC 

accidents, with special focus on the most vulnerable 

road user group i.e. the motorcycle/pillion riders. 

To acknowledge the efforts of journalists working 

in the local media for coverage and analysis of the 

auto sector as well as enhancing the quality of 

professionalism in this field, we organized the 2 nd 

National Auto Journalists Awards 2009. 

We believe in uplifting education in our country, 

especially for those whom education is unaffordable. 

We firmly believe that our youth is the future 

backbone of Pakistan and offer internships to 

university students and financial assistance is 

39 

provided to innumerable schools and educational 

institutions. We also aim to spread technical 

education amongst the younger generation via the 

Toyota Technical Education Program and the 

Apprenticeship Training Program. 

Indus Motor sponsored a team of Ghulam Ishaq 

Khan Institute students to take part in the Shell Eco- 

Marathon which took place in Berlin, Germany on 

May 29, 2009. Student teams design and build fuel 

efficient vehicles, which will encourage conservation 

and stimulate education that promotes sustainable 

mobility. 

We in collaboration with the House of Habib, 

remained at the forefront of relief operations for 

the Internally Displaced Persons (IDPs) of Swat, 

Buner and Dir Districts. Our relief efforts were done 

through our dealership in Mardan and we distributed 

food rations, kitchen utensils and provided medical 

services as well as transport via our Hilux pickups. 

During the year we received a number of awards 

and recognition. Indus Motor is in the top 25 

companies for the year 2007 and 2008, by Karachi 

Stock Exchange. We have received the prestigious 

MAP Corporate Excellence Award for the past 

4 years, the National Forum for Environment and 

Health Award for Environmental Excellence for the 

last 6 years and the Pakistan Center for Philanthropy 

rated IMC 8 th in philanthropy nationwide amongst 

500 public listed companies. 

Toyota Team with Indus Motor Company and Shell Pakistan’s Management with the vehicle at the reception

IMC Team Member at the Assembly Line 



Strategy to Face the External Environment, 

Business Risks and Challenges 

Moving forward, we expect 2009-10 to be a better 

year but a critical one for sustainable growth and 

development of Pakistan’s economy. 

It is essential for the government to effectively 

address the challenges concerning consolidation 

of macroeconomic stability, mitigating the effects 

of the global economic crisis – in particular on 

manufacturing and exports, implementing tax policy 

and administration reforms and managing the 

security issues engulfing the nation. 

We hope that government will provide stable 

policies and will take proactive steps to encourage 

growth of the local automobile sector which has 

made healthy contribution to the national 

exchequer, creates thousands of jobs, enables 

technology transfer for localization, provides 

affordable mobility to people and businesses and 

above all, contributes heavily to economic 

prosperity of the country. 

Pakistan provides a huge upside for growth of the 

auto industry and for it to crystallize it is imperative 

for the government to make a concrete plan to 

revisit the AIDP and achieve implementation 

recognizing the recommendations made by OEMs 

and the Pakistan Automobile Manufacturers 

Association. 

On our part, Indus Motor will be taking several 

steps to meet the challenges and continue to 

manufacture high-quality vehicles for the benefit 

of society following Toyota’s Philosophy. In the 

long-term, we will look to increase capacity and 

fill it with new products at the right opportunity, 

while in the near term we are already working on 

definitive plans to expand dealer network and 

launch new CKD/CBU products. 

41 

We will do our utmost to optimize costs without 

compromising on quality and delivery. Although 

we have improved our market share in a declining 

market we will continue to remain aggressive, 

focused and innovative in our marketing activities 

coupled with dealership improvements. 

I thank our Board of Directors and the management 

team for steering the Company in these very 

challenging times. We are extremely grateful to 

our customers for purchasing and driving our 

vehicles and for their trust and confidence in our 

products and service. I would like to thank our 

Indus Team, our Shareholders, our Dealers, Vendors 

and Business Partners. 

We bow to Allah and pray for His Blessings and 

Guidance. 

Ali S. Habib 

Chairman

Chairman's Review - Indus Motor Company Ltd.

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