Table of Contents

Executive Summary.....................................................................................................2
Introduction & Product Specification .......................................................................3
Specification of Bicycles in Pakistan .........................................................................4
Production capacity and Major players.....................................................................6
Locations.......................................................................................................................8
Production and Capacity Utilization .........................................................................8
Import/ Export for Five years.....................................................................................9
Raw Material (Local, Imported)...............................................................................10
Sources of Raw Material ..........................................................................................11
Production process.....................................................................................................12
Problem faced by Industry .......................................................................................22
Technological Level....................................................................................................23
Pricing.........................................................................................................................24
Government Policies and Incentives.........................................................................24
Future Prospects (after WTO)..................................................................................26
Bibliography...............................................................................................................27
 2

Executive Summary

Bicycle industry in Pakistan has a significant background in the history of Pakistan.

There was no registered manufacturing business related to bicycle. It takes few years
to have a new corporation which agree to manufacture some of the parts of the bicycle
locally in Pakistan. Pakistan cycle industry ranked at the lower level if it compare
with the remaining world. Some of the neighbouring countries have more competitive
market shares in the world. There are few types of bicycles which are producing in the
Pakistan. One of them has more demand in the market and others have low market
share world wide. All the types of the bicycles are available in many sizes. One of
them is stronger than other types, in terms of using in the rural areas also. The
production capacity of bicycle has mixed trend in Pakistan. It increases for some years
and then decrease and also again increases during few years. There is significant
number of major players of bicycle in Pakistan but one of them has captured the
maximum number of market share and created a monopolistic environment in the
bicycle industry. The locations of the major factories are in the approachable position
of the country. Major factories have large capacity of production and they are also
utilizing their capacity in an efficient manner. The import of raw material has
fluctuating trend during last few years and export has low trend during the last few
years. There is lot of raw materials used in the bicycle industry. Most of the raw
material is manufacturing locally and is being collected from the local vendors from
the same location. But the main raw material is imported from the other countries
with direct relation of the companies with the vendors in other countries. Some of the
finished parts of bicycle are also imported from different countries. The production
process which the industry is using is almost the same in all factories. The difference
is in the size of the production plant and capacity of plant. But the major parts of the
bicycle are manufactured by the factories. The production process includes the input
of the raw material from the imported one and local one and the process is being
carried out in different large number of stages and at the last the finished items are
taken to the stores of the factory. Most of the factories are selling their bicycles
without assembling them. The problems which are currently facing by the bicycle
industry include smuggling of imported bicycle with low prices and good look which
attracts the customers, the instability of the government in the Pakistan, the labour
unions laws, no availability of imported tool material in Pakistan and the Non
Engineering background work force of the factories. The level of the technology
which is being used in the manufacturing of the bicycles is basically not up to date
and most of the machinery is old enough not to operate well. The prices of the
bicycles are economic level in all the types, according to their target market. The
government policies for the light engineering industry are not much familiar and most
of the time policies don’t have the incentives for the particular industry. The impact of
WTO rules on this industry will automatically improve the efficiency of the industry
and their related businesses. But there are some demerits also which will face in terms
of WTO implementation on the specific industry. Government is not seriously taking
this industry as the major player of the economy.

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Introduction & Product Specification

History

There was no single factory which manufactured bicycles and their spare parts at the
time of independence in Pakistan. There were no industry in Pakistan and due to that
fact some of the importers of that time brought bicycle in Pakistan and passed on for
sale to retailers most of the shops were situated in Lahore at Nila Gunbad which was
the main market of bicycles. Today Nila Gunbad market is the main market of car
tyres, Bicycle tyres and spare parts.

Arrival of Bicycle industry in Pakistan

In 1952 the Shortage of foreign exchange reserves encouraged a serious look into
domestic production and a remarkable idea was conceived by the twenty two shop
owners of the Nila Gunbad area drafted a plan to establish foundation of a co-
operative society for the purpose of bicycle manufacturing factory within the country
on cooperative basis. The main reason behind the establishment of the society is to
provide mutual help and benefits to its founding members. Elections of the society
were held promptly. The society has been functioning successfully all along is
because of the fact that its members take deep interest in its working.

Local & imported Spare Parts

According to the reports of different governmental departments only a few spare parts
of bicycles were manufactured locally at the initiation of Bicycle industry and about
90% spare parts were import from abroad. The situation started improving with the
passage of time and today almost 98% bicycles spare parts are being manufactured in
Pakistan or through vendors. According to different published sources there are 300
bicycle vendors in Pakistan and employing more than 3000 workers.

Pakistan Bicycles industry overview

If we compare Pakistani bicycle industry with international bicycle industry then we

can see that we have only one major manufacturer in the industry and covering the
entire local market. The international bicycle industry is much stronger than Pakistani
bicycle industry. India is the second largest manufacturer of bicycles after china.
China has great contribution in the manufacturing of bicycles. Chine’s Bicycle
industry is a big threat for both Indian and Pakistani bicycle industry. We can say that
the decline of local Pakistani industry is just because of imported Chine’s Bicycles are
covering the market share.

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Specification of Bicycles in Pakistan

In Pakistan bicycles are the only cheaper means of transportation for the local public.
Bicycles are categorized in to fancy and standard bicycles.

• Fancy Bicycles
• Standard Size Bicycles
80% 80%

60%

40%
Standard
20% 20% Fancy

0%
Standard

Standard bicycle is the smaller segment worldwide and is on the decline with more
and more companies turning towards fancy bicycle. In Pakistan standard bicycle is the
bigger segment. The sub segments of the fancy bicycles in which mountain bike,
BMX, Electric bicycles and recumbent bicycles. If we want to segment the bicycle
industry then we can segment bicycle in to three categories small size bicycles,
medium size which is also called fancy bicycles and standard size bicycles.

Fancy Bicycles

A fancy bicycle has different types which attracts the

youngsters. When we talk about speed then indeed one
thing always come in to our mind that less weight
bicycles are more reliable for customer point of view.
Fancy bicycles has the speciality of different frame
designs, colours, braking system, comfortable seats,
stylish reflectors, electric light system for mountains,
classy mudguards, sporty looks, shining nickel brings
more beauty in the product which attracts the customers. Gear system increases the
speed of the bicycle but decrease the pressure of pedals.

Small size bicycles

Small size bicycles are only for children’s which has child attraction features in which
the colour, frame design are more important features. It lies in the category of Fancy
cycles.

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Standard Size Bicycles

The third segment is standard size bicycle which is for

personal use instead of entertainment. The benefit of
standard bicycle in Pakistan is more as compare to
fancy. The target market of standard bicycle is poor
people or those who work on wages. There are
50,000,000 people who work on daily wages in all the
areas of Pakistan and to be considered as the poor
people. The standard bicycle is the major benefit for the
Pakistani region.

Standard Bicycle speciality

These are the countries China, India, Pakistan,

Afghanistan, Bangladesh, and Syria in which the
largest population is dependent on bicycles. The main
features of standard bicycle is heavy weight, we can
carry children giving a ride to our spouse. Carrying
capacity is more than fancy bicycles. We can carry
lunch boxes, laundry cloths, milk containers and a
variety of things. People play bicycle polo in northern
areas of Pakistan. The bicycle of night watchman in
our colonies proudly rides it all night, blowing a shrill
whistle to remind us that he is keeping a careful eye on streets.

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Production capacity and Major players

Production Capacity

The capacity of the Pakistani bicycle industry is to produce 1.45 million bicycles per
annum. From 2002 to 2003 the local production of bicycle recurring with 629,695
numbers of bicycles produced according to the industry statistics. From 2003 to 2004
681448 bicycles were produced with the increase of 8.22% from previous year. From
2005 to 2006 the production of bicycles was 449400 which was a decline from the
previous trends, in year 2007-2008, the production increases to approximately
650,000 and in year 2008 the capacity increase to approximately 1 million.

1000000

800000

600000

400000 Production Capacity

200000

0
2003 2004 2005 2006 2007 2008

1200000
1000000
800000
Trend in Production
600000
Capacity
400000
200000
0
2003 2004 2005 2006 2007 2008

Major Players

According to the SMEDA report Pakistan bicycle industry is dominated by one key
player, Sohrab which comprised more than (80 %) eighty percent share of the whole
industry whereas the rest of (20 %) the production is shared by other six authorized
and unauthorized manufacturing companies. Our group members visited many dealers
in the market and talked about the current trends or preferences of the customers.

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Market share of Standard bicycles Market share of Fancy bicycles

5%
13% 5%
7% Sohrab Sohrab
Eagle Phoenix
Others Others
80%
90%

Chinese Phoenix Bicycle

Major Manufacturing
Chinese Phoenix bicycle was every where in the shops. companies of Bicycle
According to the shop keeper the demand for Chinese Industry (Standard and
Phoenix cycle is very high just because of low prices Fancy Bicycles)
and stylish designs which attract customers. All spare Companies Name
parts of Chinese bicycles are available in the market. Chinese Phoenix
Low quality and low price Chinese Phoenix bicycles Sohrab
are also available in the market. Some people go to the Eagle
PEGO
price factor and rest go with the quality factors. There
Falcon
are some more types in which you will find High price SONY
and high quality Chinese Bicycles. The finishing of the Sartaj
Chinese bicycle is excellent as compare to the local Humber
manufactured bicycles. Chinese bicycles are not solid Olympic
in nature but the fancy categories are the main focus of Eagle Karachi
Chinese bicycles. Sindh Cycle
Unorganized Sector
Sohrab

Sohrab established since 1953, as a small assembly unit for bicycles. The “Sohrab” a
standard bicycle, is the largest selling bicycle in the country. Several other varieties
produced under the brand name Sohrab include, sports and fancy bicycles in which
BMX, Panda, Vip sports, Sprinter, Mountain bikes (with Multi Speed Gears).

Sartaj and Humber

Some local unauthorised manufacturers buy different spare parts and make their own
bicycles at home and then sell into the market by putting the names of Sartaj and
Humber. I saw two or three Bicycles of Sartaj in which the handle of the Bicycle was
made of Sohrab and some of the parts were Chinese and local made. There was no
check from the governmental authorities which is the need of the bicycle industry.

Market Story of different bicycles

In standard bicycles Sohrab is the one which people like most in Punjab. We asked
many dealers about Sohrab they said Sohrab is like a Brand in standard Bicycles
people always prefers Sohrab Bicycle. Falcon Bicycles are manufacturing in china
and the dealers put the name ‘Falcon Pakistan’ and sell it in the local market. Eagle
and Sohrab are the two companies which are manufacturing standard bicycles and the
cost is also affordable and providing 5 years Warranty of the frame and other parts as

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well. Sartaj is the Indian Bicycle name but manufacturing in Pakistan. Sartaj is also
providing 5 year warranty of the frame. The same Sohrab frames are being used by
these small companies like Sartaj and humble.

Locations

SOHRAB SARTAJ
Rustam & Sohrab Factory Locally Manufactured
Sheikhupura Road, Shahdara, in Nila Gunbad Workshops,
Lahore-Pakistan. Lahore, Pakistan

Phoenix PEGO
Imported from China, Locally Manufactured,
In Nila Gunbad Workshops,
Lahore, Pakistan
EAGLE
Shahdara, Lahore HUMBER
Locally Manufactured, In
Nila Gunbad Workshops
Lahore, Pakistan

Production and Capacity Utilization

The capacity utilization of the Bicycle industry is:

Capacity Utilization = Effective Capacity .

Production Capacity

= 2300 .
3000
= 77 %

Production Capacity
Capacity Utalization
Capacity Per
Day

0 1000 2000 3000 4000

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Import/ Export for Five years

All values are in thousands US dollars
Sr. No. Years Import Export
1 2001 1329 0
2 2002 10,443 1762
3 2003 16,060 11
4 2004 15,710 0
5 2005 11493 0

In the above table we can easily differentiate each year import and export. In the year
2001 the import was 1329 thousand US dollars but exports were zero. In 2002 the
imports were 10,443 thousand US dollars and exports were 1762 thousand US dollars.
In 2003 the export level which was 16060 thousand US dollars was higher than the
previous years on the other hand the exports of 2003 was only 11 thousand US
dollars. After the period of 2003 the imports started decreasing and come in to the
level of 15,710 thousand US dollars. The exports were zero at that time. In the 2005
figures the imports were 11493 thousand US dollars which is again decreases from
the previous year 2004. The exports were zero in 2005.

18000
16000 2000
14000
12000 1500
10000
8000 Im ports 1000
6000 Exports
4000
500
2000
0
2001 2003 2005 0
2001 2002 2003 2004 2005

Trend of Imports Vs Exports in Five years

The trend of
imports and 20000

exports clearly
15000
justifies that the
imports were Imports
10000
very high and Exports

the exports were 5000

very low but in
0
2002 we can see 2001 2002 2003 2004 2005
the increment in
the exports of

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Raw Material (Local, Imported)

Steel

The Steel metal sheets and rod lengths which are heavily used in the manufacturing
process of all the small components of Bicycle are suing from the loc

The steel which is used for manufacturing frames of bicycle are imported from United
Kingdom. The reason behind buying from international market was the metal which
can easily bend in the high heat temperature. The metal which is local made was not
easily bent in the high heat temperature and the chances of wastage were very high.
Some small manufactures use local material instead of imported like Eagle
Manufacturers in Lahore.

Plastic Material

Plastic material which is being used in the Bicycle is local. Companies prefer local
because the cost of imported is higher than the cost of local plastic material.

Nickel

The chemical which is used for the purpose of electroplating process is also imported.
According to the manufacturers the local chemical is in low quality but the imported
chemical is good in quality.

Paint

The paint which is used for the frames of bicycle is locally made instead of buying
form international market.

Acids

Acids which are used heavily used in the manufacturing process are imported. Local
are also available but those companies like Sohrab they prefer imported material.

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Sources of Raw Material

Steel

The steel which is used for manufacturing bicycle frames are imported from United
Kingdom. The steel which is used for manufacturing small metal parts of the bicycle
are local made from ILL Company and are the main dealer of Karachi Steel mills.
Front head of bicycle is imported from Italy and Japan.

Plastic material

Plastic material is from Universal Rubber Manufacturer in Lahore and some other
vendors it depends upon the prices and relationship of the firms with their vendors.

Nickel

Nickel is imported from United Kingdom the company which is the largest provider
of nickel all over the world is INCO.

Paint

Paint is locally used from ICI companies and Burger paints. Both companies are the
best companies in Pakistan and are considered to be the best provider of paints.

Acids

All acids which are used in the manufacturing process are imported from United
Kingdom and locally made in Lahore as well. But the companies which are trying to
improve the quality of the bicycle they usually prefer imported acids.

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Production process
Brief view of Sohrab Production Plant

We went to the Sohrab production plant and the assembly line engineer told us about
the production process of the frame and bicycle components. He said the process of
producing these frames and components all over the world is same but the technology
which the other companies are using may be more advance. There are 35 workshops,
named “Shop”, which are producing different components of bicycles in the Sohrab
manufacturing plant. These 58 workshops covered almost 15 acre of the land and the
remaining 10 acre area is covered by different offices. It was the wonderful
experience of our group members while sorting all the production operations in the
factory. More than 3 to 7 machines were installed in each workshop. The sizes of each
workshop depends upon the nature of the component either it is bigger or smaller. If
the component has different stages of production it requires bigger space. Time
management was excellent by the workers who were producing different tasks in each
workshop. The main production departments are in this table.

No. Workshop/ Department No. Workshop/ Department

1 Brake 30 U.C.P Plant
2 Wheel Chair 31 Mudguard
3 Polishing Mcs 32 B.B. Axle
4 Enamelling 33 Press
5 Electric 34 R. M. Store
6 Frame 35 G. Store
7 F.G. Store 36 Rim
8 Handle 37 Granodine
9 Inspection 38 Invoice D.S.S Office
10 Packing 39 E/P (Manual)
11 Welding 40 B.M.X
12 Cyclo Machines 41 Design Office
13 Rex. Saddle 42 Pro. Planning and Control
14 Pedal Assy 43 Mat. Control
15 Hub 44 Transit Pool
16 Machine 45 Laboratory
17 Pedal Turning 46 D. Nickle
18 Fabrication 47 Foundry
19 Machine Maintenance 48 N.P (Manual)
20 Screw 49 Polishing
21 B.B.Shell 50 E/P Plant 1
22 B.B.Fitting 51 Warping Assy
23 Cutting 52 E/P. Plant 2
24 C.W Crank 53 E.P. Plant 3
25 F.F. Fitting 54 Jig Repair
26 Front Fork 55 Cold Forging
27 Hot Forging 56 Bulging
28 Free wheel 57 Heat treat Plant
29 Pedal Axle 58 Motor Cycle Prod DEV

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The table describes the departments which has different task to perform. These
workshops or departments produce different components of the Bicycle. It was very
difficult to study the function of each department in depth. Mr. Afzal was the engineer
production of training program in Sohrab Manufacturing plant. Mr. Afzal told us that
it will take four months to understand the system or flow or production process in
Sohrab Factory.

Process Flow Chart of Bicycle

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Material Bending/ Drilling/ Welding/

Preparation Shearing Twisting Riveting

Spring, nuts Painting/

Assembling Packing
And Bolts Electroplate

• Material Preparation
In material preparation all the raw material which includes the Steel metal sheets and
rod lengths which are heavily used in the manufacturing process of all the small
components of Bicycle, Plastic material which is being used in the Bicycle, the nickel
which is used for the purpose of electroplating process, paint which is used for the
frames of bicycle and Acids which are used heavily in the manufacturing process for
cleaning of metal surfaces.

• Bending / shearing
In the bending process rods are used to bend by heating the rod to make the surface
soft and easily bend. By filling the rod with sand and bend the road with the help of
bending machines. The rod of bicycle handle is also bending with the help of bending
machine. In the shearing process metal sheets cut in to different shapes according to
the requirement of the component with the help of sheets cutter machine. In the rims
of the bicycle metal sheet strips are used to manufacture a rim.

• Drilling/ Twisting
In the drilling process different components require different types of drilling like in
the manufacturing of rim drilling is used in the rim metal surface to fix the spokes.
The spokes holes are punched simultaneously through a hydraulically operated
machine

• Welding/ Riveting

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The welding process is also called brazing process which is used in the joining of
bicycle joints. After welding process the brazing metal frame are cleaned off by
pickling in acid solutions and by washing the metal surface until it is smooth.

• Spring, nuts and Bolds

Different machines are used for making springs, nuts
and bolds. These workers are making different types
and sizes of nuts, springs and bolds. Each machine
operates manually by one or two workers.

• Painting/ Electroplating
Paint may be applied by hand spraying or by passing the frames through automatic
spraying rooms. The finishing of hand spray is better than the finishing of automatic
spray machine. Hand spray require more time. Chrome plating may also be used
instead of paint on components such as the fork blades in few cases. After spraying
process they bake the frame for few minutes in to the temperature room in order to
dry the paint. Some of the parts of bicycle require nickel coating instead of paint and
the plant is called automatic electroplating plant. The parts are loaded from one end
and then go through the electroplating process. At the end of the process, they are
unloaded from the same end.

• Assembling
In the assembling process if the requirement from the dealer to assemble the bicycle
then they install all the parts of the bicycle.

• Packing
In the packing process six bicycle parts are packed into plastic and cardboard boxes to
supply to the dealer.

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Production Process of Bicycle Frame

Flow chart

•
Raw Material Washed with
Pipes
Oiling Kerosene oil

Sawdust and
clean
Cutting Stretching

Cleaning
Brazing Aligning Finishing

Pipes
Pipes are bought from outside vendors. Theses pipes are in lengths and are of special
quality in term of thickness and size. The Flat steel sheet wrapping it into a tube and
welding it together along the length of the tube and these tubes may then be further

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manipulated to increase their strength and decrease their weight by butting, or altering
the thickness of the tube walls.

• Oiling
The pipes are covered with oil to protect them from rust. The process of oiling is done
by using the paint brush and dips it in to the oil and rubs over the surface of pipes.

• Washed with kerosene oil

After oiling these pipes are covered with kerosene oil and wash the pipes with
kerosene oil.

• Wiped with Sawdust and cleaned

After washing with kerosene oil they rub the surface of pipes with sawdust which
absorb the oil from the surface of the pipes.

• Cutting
In the cutting process pipes are cut in to different sizes according to the requirement.
Pressing machines are used in cutting the pipes according to different sizes.

• Stretching
Stretch the pipes thinner and longer tubes, a process called cold drawing. The tubes
may be shaped and tapered into a variety of designs and lengths. The fork blades may
have to pass through more than a dozen operations to achieve the correct strength,
weight, and resilience.

• Brazing Process

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Tubes can be joined into a frame either by hand or machine. Frames may be brazed,
welded, or glued. The brazing filler is generally
brass (copper-zinc alloy) or silver, which melt at
lower temperatures than the tubes being joined.
The T joints are made in dies in which pipes are
fitted. In brazing process the parts in which
front wheel frame are fork blades which hold
the front free wheel. The four tubes which are
connected together in forming a frame in which
the Seat tube is connected with the top tube
and the rear tubes. Down tube is connected with
the head tube and the seat tube. The rear triangle in the above diagram consists of the
chain stay, seat stays, and rear wheel dropouts are attached to the seat tube from
both ends.

• Aligning
The assembled frames are placed and checked for proper alignment. Adjustments are
made while the frame is still hot and malleable. Forge from hammer to adjust the
frame. Adjust the frame from all sides according to the required measurement.

• Cleaning
The excess brazing metal frame are cleaned off by pickling in phosphate solutions and
by washing and grinding the brazing until it is smooth.

• Finishing

Flow chart of Finishing

ZincCalcium
Prepare
Polyclean Phosphate
Surface

Chromic Electrostatic
Acid Spray Paint

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The frames are painted to create more finished appearance the frame is first prepared
with an undercoat and then painted with colour enamel. They first prepare the surface
of the @1919 191919

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ÏÏð<202020@2020 202020 ed. Polyclean is used for degreasing. Zinc calcium

phosphate layer is added for paint purpose. The pores are then sealed with chromic
acid. The frame is passed through an electro static spray painting plant. The painted
parts are passed through an oven where the temperature is kept between ‘150-160’
degree C. The frame is first sprayed with primer and then re coated with paint for
luster finish. In case of red colour, the paint is sprayed with a manual spray gun. First
the part is covered with black paint then Aluminium colored undercoat is done and
finally sprayed with red paint.

Production Process of Rim

Flat Steel
Turning Bending Welding
Strip

Drilling/ Polishing Nickel

Punching Machine Process

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The machine takes a flat steel strip, turns the edges, bends and welds them. The sheet
is rolled and person sits and cut the sheet according to the required size with the help
of a gauge. The spoke holes are punched simultaneously through a hydraulically
operated machine. They also have a person who punches these holes manually for
fancy and non standard rims. They have polishing machine that polishes the rims.

After polishing process rims go to the Department of Nickel where the process of
electroplating implemented on the rims which give the silver shining colour to the
rims. After the entire process they fix spokes, which are laced one round at a time
between the rim and hub flange.

Production process of crank

Blanking/ Punching/ Indexing/

Piercing Teeth cut Dish Form

Center Hole
Teeth Spline
Spline
Tapering Cutting Forming

Nickel &
Chrome
Inspection Packing
Plating

Dish form cuttings from the Mild Sheet in the picture.

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We saw the crank workshop as well where the workers were cutting the Mild sheet in
to circles and after that they further make holes in to the circles and after the
completion of crank sets they further move to the D Nickel department for
electroplating process. The crank set supports the pedals and transfers power from the
pedals to the chain and rear wheel. Crank sets consist of steel or aluminium alloy
crank arms, chain rings, and the bottom bracket assembly of axle, cups, and bearings.
They are attached with bolts and caps into the bottom bracket of the bicycle frame.
The pedals are then screwed to the ends of the crank arms

Production Process of pedal Arm

Thread
Heating Forging Drilling
making
Performing Trimming Reaming (left hand)

Spline Nickel&
Spline Pushed in 1
Sprocket
Buffing Chromium
Forming Plating
arm

Final
Packing
Inspection

Problem faced by Industry

Pakistan Bicycle market is struggling to establish itself due to smuggled bicycles

coming from China and India, high raw material utility prices. There is very low
export presence of Pakistan in this sector and according to IAR (Industrial advisory

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report) ‘one player Sohrab dominates with 80 % share in the local market and for a
new manufacturer to establish itself in this sector, he would need to concentrate on the
fancy bicycle segment and may flourish if he enter in to the joint venture agreement
with some internationally reputed firm’. If bicycles imports from India and china are
allowed, then it will be difficult for the local bicycle industry to compete on the basis
of prices competition.

Political situation is one of the important major issues faced by the Bicycle industry.
The unstable political system and terrorist activities are creating hurdle for this
industry in which export of bicycles to Afghanistan is one of the biggest challenge for
the industry. Cross border trade between Afghanistan and Pakistan was seriously
disturbed by these terrorist activities on both sides of the border line. Trade between
Afghanistan and Pakistan was closed since the US forces holds the command of
Afghanistan after 9 /11 military operation. Mr. Afzal told us that before 9 /11 the
industry was moving towards growth but after the incident of 9 /11 the graph of
growth moves towards decline stages after the bad incident of 9 / 11. Mr Afzal
(Engineer production) told us that all the industries which are linked with the bicycles
industry are also affected by 9 / 11 incident.

Mr. Afzal (Engineer production) told us that there are 200 top level union labours
who are taking salaries from Sohrab management and these workers are not working
in this factory but these people can seen every where in the Sohrab factory. Mr. Afzal
told us that there are 227 owners of Sohrab and the main issue among these owners
are decision making process.

The tools which are used in manufacturing process were imported but it could be
difficult for the firm to import the tools on regular basis. The other issue is the import
duties on such heavy equipments are the major problem faced by the industry.

Workers who are working in this industry are non engineering background. Most of
the labours are graduates with simple BA degree and the rest of the labour are hardly
metric pass. When I asked Mr Afzal that what is your qualification? He replied that I
am intermediate with mechanical diploma holder. Mr Afzal said I had great long time
experience with this industry. We went to another production manager and he was the
only person who had a BSE mechanical engineering degree and told us about the
communication problem among different workers on field.

People who are highly educated avoid staying in the bicycle industry for employment
because of low salaries and less incentives provided by the Sohrab management
authorities forces the educated workers to switch the job.

Technological Level
The technology which is used by the Pakistan bicycle industry is very low. If we
compare the technology used by Pakistan bicycle industry with the international
bicycle industries then we can say that we are 90 percent far away from those latest
technology users.

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The machines which are running in Pakistan bicycle industry were installed in 1957
and after that time they just replace the spare parts instead of the entire plant or
machine.

According to Mr. Afzal (Engineer production) told us that the machines which are
used in the process of manufacturing was towards the last stages of life. Government
is not paying any attention in helping the bicycle industry in bringing the new
machinery in Pakistan.

The paint department is using automatic machines which we can say that those
machines are slightly towards a symbol of new technology.

According to Mr. Afzal (Engineer production) the electroplating department is using

medium level technology as compare to other machinery.

Pricing
As there are two major categories of the cycle:
• Standard Bicycle
• Fancy Bicycle

So, Prices are:

Average Price of Standard Bicycle: Rs. 4700

Average Price of Fancy Bicycle: Rs. 8000

Government Policies and Incentives

There are some of the government policies which are related to bicycle industry in
Pakistan. These include:

Material Constraint

Government has pointed some of the specific vendors for purchasing the raw material
only from them.

Labour Law Constraint

Government has a rule:

• Not to fire the worker in any case without the proper documentation and with
in a long period of time.

University of Management and Technology, Lahore Pakistan

 25

• And also the company should have to pay the wages even if the factory is not
in the operations.
• Also if the worker is on leave so the company have to pay him/her half of its
pay.

University of Management and Technology, Lahore Pakistan

 26

Future Prospects (after WTO)

As Pakistan is the member of the WTO since 1st January, 1995. After the WTO
applied on bicycle industry so there are some of the benefits associated with this
prospect. These are as:
• The raw material especially nickel and the steel rods which are directly
imported from different countries by the companies, will cost less because of
some of the import and export duties charged on them, so the prices of the
bicycles will automatically be cut down.
• Some of the parts in finished products like spokes and chain & its cover are
also imported from some countries, so after WTO their prices will also cut
down.

There are also some of the demerits of the WTO:

• After WTO, Pakistan bicycle industry will face a lot of competition from other
multinational companies.
• They are not able to compete with them in terms of prices.
• They are not able to compete with them in terms of quality.

University of Management and Technology, Lahore Pakistan

 27

Bibliography

http://www.smeda.org/business-development/pre-feasibility-studies.html/ download

http://www.smeda.org/archives.php/ download

http://www.smeda.org/info.php?id=88

Pakistan /Punjab/Lahore/UMT/library/statistical data

Pakistan/IAR reports/bicycle Industry

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/training center/M.Afzal (engineer

Production)

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/training center/deputy production

Manager

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/ Hadlug Bluging Shop/Munir

Ahmad (worker)

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/Chain Wheel Shop

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/RIM Shop

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/Younas cycle

works(shop)

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/Asim cycle

Store(shop)

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/London cycle

store(shop)

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/S. Hanif &

Brothers(shop)

University of Management and Technology, Lahore Pakistan