Sultan
August 7th, 2004, 08:31 AM
Pakistanis use global ties to make inroads on used cars
The Asahi Shimbun
--------------------------------------------------------------------------
The surge to 300 billion in annual sales is just the start.
Selling used cars abroad, once a minor business, has become a 300 billion yen a year industry-and the driving force behind more than half the deals are Pakistani dealers living in Japan.
The booming niche business is led by entrepreneurs with global connections. The secret to their success? Small profits and quick returns. Arrangements are easily made via cellphone, and hardworking dealers do not shy away from even the tiniest of business transactions.
Their Japanese counterparts are feeling the crunch. ``There is no profit,'' says one dejected Japanese used-car exporter in Yokohama. ``I want to quit.''
Until five years ago, the man exported about 100 cars a month. Now, he scrapes by on about 10 transactions a month. He once raked in 100,000 yen to 200,000 yen per car. His profit margin is now slashed by half. He believes his business is suffering from the effects of the wave of Pakistani dealers who he says will export anything-even if there's as little as 10,000 yen to be made.
There are now more than 800 used-car exporting businesses-and over half are Pakistani owned, industry sources say. There were several dozen Pakistani businesses about a decade ago.
A 42-year-old Pakistani used-car exporter, based in Saitama Prefecture, is one such success story.
With a crew of three Japanese and Pakistani employees, he sells about 200 million yen in used vehicles annually.
When he set up his company seven years ago, about 40 of his fellow countrymen were doing business in the area. Now there are more than 300.
He says a worldwide network of Pakistani entrepreneurs contributed to the rise in dealers from his home country.
Another dealer agrees.
``I trade with 20 countries around the world,'' he says. He does business with compatriots in nations such as the United Arab Emirates, Iraq and South America from his trusty cellphone, he says.
According to the Finance Ministry, 720,000 used cars were shipped abroad in 2003, a 50-percent increase in five years. The average price per car was 500,000 yen. The export market pales before the 7 trillion yen domestic used-car market. But it's growing.
``Pakistanis are versatile in languages and have good marketing acumen,'' says Hiroki Fukamachi, a senior researcher at the Institute of Developing Economies at the Japan External Trade Organization (JETRO). ``Their business is just starting to take off.''
JETRO researchers note the network of 50 million Pakistanis around the world, and shipping cars through virtually duty-free Dubai in the Middle East, have given the entrepreneurs in Japan leverage. But it has not all been smooth going.
According to Saitama prefectural police, three Japanese men allegedly belonging to a political group disrupted a used-car auction sale in Koshigaya, Saitama Prefecture, on Feb. 28. The men drove onto the site in sound trucks blaring, ``No illegal parking.'' They also uttered ethnic and racial epithets and fired air rifles into the air. Offended foreign pedestrians threw stones and kicked the vehicles. It was not the first time the trucks appeared.
``As foreigners living in Japan start establishing themselves, they begin to specialize in a specific field, promoting a level of independence,'' says Yasuo Kuwahara, former president of Dokkyo University and professor of labor economics. ``There will be plenty of scenarios in the future in which Japan's level of tolerance will be tested.''(IHT/Asahi: April 6,2004) (04/06)
http://www.asahi.com/english/nation/TKY200...ds~on~used~cars (http://www.asahi.com/english/nation/TKY200404060123.html?headline=Pakistanis~use~global~ties~to~make~inroads~on~used~cars)
The Asahi Shimbun
--------------------------------------------------------------------------
The surge to 300 billion in annual sales is just the start.
Selling used cars abroad, once a minor business, has become a 300 billion yen a year industry-and the driving force behind more than half the deals are Pakistani dealers living in Japan.
The booming niche business is led by entrepreneurs with global connections. The secret to their success? Small profits and quick returns. Arrangements are easily made via cellphone, and hardworking dealers do not shy away from even the tiniest of business transactions.
Their Japanese counterparts are feeling the crunch. ``There is no profit,'' says one dejected Japanese used-car exporter in Yokohama. ``I want to quit.''
Until five years ago, the man exported about 100 cars a month. Now, he scrapes by on about 10 transactions a month. He once raked in 100,000 yen to 200,000 yen per car. His profit margin is now slashed by half. He believes his business is suffering from the effects of the wave of Pakistani dealers who he says will export anything-even if there's as little as 10,000 yen to be made.
There are now more than 800 used-car exporting businesses-and over half are Pakistani owned, industry sources say. There were several dozen Pakistani businesses about a decade ago.
A 42-year-old Pakistani used-car exporter, based in Saitama Prefecture, is one such success story.
With a crew of three Japanese and Pakistani employees, he sells about 200 million yen in used vehicles annually.
When he set up his company seven years ago, about 40 of his fellow countrymen were doing business in the area. Now there are more than 300.
He says a worldwide network of Pakistani entrepreneurs contributed to the rise in dealers from his home country.
Another dealer agrees.
``I trade with 20 countries around the world,'' he says. He does business with compatriots in nations such as the United Arab Emirates, Iraq and South America from his trusty cellphone, he says.
According to the Finance Ministry, 720,000 used cars were shipped abroad in 2003, a 50-percent increase in five years. The average price per car was 500,000 yen. The export market pales before the 7 trillion yen domestic used-car market. But it's growing.
``Pakistanis are versatile in languages and have good marketing acumen,'' says Hiroki Fukamachi, a senior researcher at the Institute of Developing Economies at the Japan External Trade Organization (JETRO). ``Their business is just starting to take off.''
JETRO researchers note the network of 50 million Pakistanis around the world, and shipping cars through virtually duty-free Dubai in the Middle East, have given the entrepreneurs in Japan leverage. But it has not all been smooth going.
According to Saitama prefectural police, three Japanese men allegedly belonging to a political group disrupted a used-car auction sale in Koshigaya, Saitama Prefecture, on Feb. 28. The men drove onto the site in sound trucks blaring, ``No illegal parking.'' They also uttered ethnic and racial epithets and fired air rifles into the air. Offended foreign pedestrians threw stones and kicked the vehicles. It was not the first time the trucks appeared.
``As foreigners living in Japan start establishing themselves, they begin to specialize in a specific field, promoting a level of independence,'' says Yasuo Kuwahara, former president of Dokkyo University and professor of labor economics. ``There will be plenty of scenarios in the future in which Japan's level of tolerance will be tested.''(IHT/Asahi: April 6,2004) (04/06)
http://www.asahi.com/english/nation/TKY200...ds~on~used~cars (http://www.asahi.com/english/nation/TKY200404060123.html?headline=Pakistanis~use~global~ties~to~make~inroads~on~used~cars)