Finding the Possibility of Creating a Local Car Brand for

Middle Income Group Utilizing the Worldwide

Recognition of Automobile Designer Leepu

Research Report on

1
Finding the Possibility of Creating a Local Car Brand for Middle
Income Group Utilizing the Worldwide Recognition of
Automobile Designer Leepu

Submitted to
Mehedi Hussain
faculty
Marketing Research

Submitted by
Group: Resonance
Group Members: Mahbob Sadi Bhuiyan (ID#062 187 530)
Rafat Mohamed (ID#062 453 030)
M. Ibrahim (ID#061 432 030)
Muntasir Ahmed Zaman(ID#061 461 030)
Farzana Afroze Zerin (ID#052 515 030)

Date of Submission: 27th August 2009

August 27, 2009

Mehedi Hussian

Faculty

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Marketing Research

North South University, Dhaka

Subject: Final report on “Finding the possibility of creating a local car

brand for middle income group utilizing the worldwide recognition
of automobile designer Leepu”

Dear Sir:

It is a great pleasure to present to you the final report on “Finding the possibility of
creating a local car brand for middle income group utilizing the worldwide
recognition of automobile designer Leepu” which we have diligently worked on
during the entire spring semester.

We have gained a most interesting & informative experience while working for this
report. Our efforts regarding learning about feasibility and acceptability of a local
car brand have not only been fruitful, but it also has given us a new insight into the
emergence undertaking similar kind of proposals or action plans. Incorporating vast
amounts of information into a concise report was indeed a challenge for us. We
earnestly hope that the report will meet the standards that you have set for us. We
are always available for further query and clarification.

Sincerely,

Mahbob Sadi Bhuiyan ……...………………………..

Rafat Mohamed ………………………………..

M. Ibrahim ………………………………..

Muntasir Ahmed Zaman ………………………………….

Farzana Afroze ZeriN ………………………………….

Table of Contents

1.0 INTRODUCTION……………………………………………………………...1

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 1.1The Inception of an Automobile Assembly Plant…………………………2
1.2 Empowering People by bringing Economic Emancipation………………2
1.3 Innovation into Perspective………………………………………………….3
1.4 Contribution towards Social Progression………………………………….3
1.5 Ecological Perspective and Poverty Alleviation Opportunities…………..3
1.6 Uniqueness and Significance of the Study…………………………………...3
2.0 SUCCESS STORY………………………………………………………………..4
3.0 PROBLEM STATEMENT………………………………………………………...5
4.0 BIG RESEARCH QUESTION……………………………………………………5
4.1 Sub Questions…………………………………………………………………..6
5.0 OBJECTION…………………………………………………………………….…7
5.1 Broad Objective: ………………………………………………………….…..7
5.2 Specific Objectives:……………………………………………………………7
6.0 SCOPE
6.1 Source of Information:……………………………………………………….8
6.2 Types of Information:………………………………………………………...8
7.0 LIMITATIONS…………………………………………………….……………..8
8.0 METHODOLOGY…………………………………………………………………9
9.0 QUALITATIVE RESEARCH…………………………………………………….11
9.1 Literature Review: ……………………………………………………………..11
9.1.1 Specific Findings of the Secondary Research………………………………12
9.2 Qualitative Research Findings: ………………………………………………13
9.3 FGD with some Professionals Representing Middle Income Group……….16
10.0 CONCEPTUAL MODEL………………………………………………….…….17
11. 0 HYPOTHESES ………………………………………………………17
11.1 Hypotheses: Case, Variable and Types…………………….……17
12.0 QUANTITATIVE RESEARCH…………………………………..….22
12.1 Sampling Plan…………………………………………………….22
12.2 Sample Characteristics………………………………………….22
12.3 Survey Instrument……………………………………………….23

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13.0
ANALYSIS/...............................................................................
.25
13.1 Reliability Analysis:………………………………………………..
………….25
13.2 Hypotheses
Analysis………………………………………………………….26
14.0 FINDINGS AND RECOMMENDATIONS:……………………74

15.0 ACCEPTANCE MODEL………………………………………...75

16.0 CONCLUSION…………………………………………………….77
Appendix 1…………………………………………………………..78
Appendix 2…………………………………………………………..79
Appendix 3…………………………………………………………..82
Reference…………………………………………………………….85

1.0 INTRODUCTION
The essence of a brand new car, though being a commonly desired utility for almost all members
of the middle income group of Bangladesh, is still perceived as an extravagance for them. People

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from this particular group do not typically possess the affordability of a brand new car which
makes them more skeptical towards the opportunity of experiencing the spirit of ownership when
they travel. In some cases, an individual or a family may have to sacrifice some of their basic
needs if they wish to avail their own car. The presently prevailing culture regarding mode of
transportation for most of our population circles around hired auto-vehicles or three-wheelers –
automotive or human driven, public transportations and in a handful of situations self-owned
motorbikes. After a significant period of life dedicated to saving enough money to buy a self-
owned car, they cannot opt for a brand new car; rather almost invariably they are compelled to be
satisfied with a reconditioned vehicle, a car that has been used before. More than 90% of this
nominal portion of the country, having own car or a family car, run a reconditioned car. Even in
numerous instances, this minimal accomplishment is largely supported by assistance from
different financial institutions imposing huge interest burden on them.

1.1 The Inception of an Automobile Assembly Plant

This research looks into the applicability as well as acceptability of one of the possible solutions
addressing this insufficiency of the targeted middle income group. The research offers inception
of a local car brand assuming the establishment of a brand new industry of car assembling in this
country. As the title goes – “Identifying the acceptance of a local car brand for the middle
income group of Bangladesh”, it clearly defines the core issue, which is to find out the level of
acceptability of a probable local car brand to the targeted middle income group who currently
cannot meet the unbearable expense of acquiring a brand new car. While initiating the research,
the researchers came across Mr. Nizamuddin Awlia Leepu, a Bangladeshi automobile designer,
who has taken himself as well as the country to the international stage by acquiring a worldwide
recognition and global response for his brilliant ideas and fascinating designs. Therefore, this
research also incorporates finding the opportunities to utilize Leepu’s achievements relating with
the basic purpose of the research which is described above. Subsequent discussion on the theme
will elaborate on the contribution of the study towards economic emancipation of the people,
opportunities for innovation, social input, environmental protection, direct alleviation towards
poverty alleviation and academic innovation.

1.2 Empowering People by bringing Economic Emancipation

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This paper deals with the issue of enabling the middle income group to purchase brand new
automobiles. It also aims to empower people by motivating them to avail a self-owned mode of
transportation which is also beneficial for them from an economic point of view. In most of the
cases, people of Bangladesh need to bear more than 120% extra of the original price of the car
due to heavy taxation on car imports. The study considers price advantage of this new brand to
be one of the most influential factors behind its anticipated success as its price will not include
any kind of import duty at all which will enable the manufacturer to distribute cars at minimum
25% less price. This price advantage will be attributed not only to the immense prospect of
making people capable of purchasing brand new cars but also to generating a solution to address
their budget constraints to meet basic requirements of living which obviously summarizes the
potentiality of the project to generate economic freedom for the country people.

1.3 Innovation into Perspective

This research project is highly prospective towards bringing innovation into perspective to a
large extent. Being one of a kind, the commencement of an automobile assembly plant will open
up new horizon for the country with wide range of opportunities to innovate. The uniqueness of
the proposal is beyond any doubt. The industry can explore the technological field of automobile
designing. This project has enough prospects to be the innovative approach towards economic
progression of the country as it will ensure enormous savings in foreign currency reserve. In the
course of the implementation of the project we can arrange an innovative academic approach
towards exploration of automobile genius of this country who will be groomed and trained by
Leepu. Their involvement and contribution to this industry will noticeably bring positive
changes. This project is collectively a whole new package of innovation and implementation of a
project like this will encourage people to provide more novel initiatives bring further possible
illustrations.

1.4 Contribution towards Social Progression

A gigantic industry like automobile assembly plant will undoubtedly generate ample amount of
employment opportunities for both skilled and semi-skilled workforce which will positively
contribute to the social up gradation of the whole nation through alleviating poverty and crime.

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Besides, as seen from the historical data of numerous instances, creation of a local car brand
results to gradual increase of duty on imported cars which subsequently sway the interest of the
customer base towards the local brand enhancing the uniformity of the society. For example, the
Iranian local car brand Sapa is almost invariably the only car driven by the whole nation. The
successful establishment of the proposed industry will be followed by development in investment
from the foreign brands who will become interested to set up their own plant in that country
making the society progress consequently.

1.4 Ecological Perspective and Poverty Alleviation Opportunities

During the qualitative research the researchers conducted a key informant interview with
Nizamuddin Awlia Leepu, apparently who also has quite similar plans, the researchers
successfully revealed his intention to bring environmental cautions into consideration. He plans
to re-use the scrap materials taken from old damaged cars, which he has successfully done
before. He is also studying on minimum carbon diffusion mechanisms for an automobile
assembly plant and intends to apply those techniques if the proposed project is implemented.
These aspects of the project raise no question about the concern on environmental protection. As
stated earlier Leepu also has it in his mind that he will coordinate a professional training and
development program for abundant skilled and semi-skilled human resources dedicated to
automobile workshops in Bangladesh. This will profoundly be a large step towards poverty
alleviation as the learners will be directly selected by Leepu to work for the Industry. This will
be incorporated as an academic approach which is completely new and innovative and will
contribute to a large extent to the development of vocational training and education.

1.5 Uniqueness and Significance of the Study

The concept of “Peoples’ Car” established successfully in several countries has projected ample
opportunities for developing nations like Bangladesh. A number of developing nations are trying
to capitalize on the numerous opportunities that surround the inception of a local automobile
industry. With a handful of progressive role models in hand, Philippines, Uganda, Vietnam and
various other developing nations are extensively investing behind the establishment of this
industry. The success of Proton (Malaysia), Maruti (India) and several other instances has
contributed immensely towards their appearance as sound economies around the globe. Taking

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Uganda as an example of developing nation like Bangladesh, this research has identified some
basic strategies undertaken by the Government of Uganda. They went into collaboration with
Geely Motors to establish a similar set up and also providing huge facilities in the form of 300
acres of free land, an initial investment of USD 10 Million, 10 years of tax holiday and a even a
dedicated port only for this industry enabling people of Uganda to save a minimum of USD 5000
per car purchased (Almost 33% of price of an imported car). Moreover, as countries like India
and Malaysia are experiencing a overflow of automobile production compared to demand
(almost three times in some cases), many automobile manufacturers will be interested to invest
in a market like Bangladesh which has an annual demand of more than 10000 cars.

The discussion elaborates the significance of establishment of a automobile assembling plant in

Bangladesh which undeniably supports the issue raised through this research. A proper
utilization of available resources for the proposed industry is expected to contribute positively
towards further development of the nation in every possible aspects. This study will only cover
the identification of acceptance level of a local car brand among the targeted middle income
group which gives us the assurance about whether a local car brand will be successful to
penetrate the automobile market of this nation.

2.0 SUCCESS STORY

"I do to cars what the fairy Godmother did to Cinderella before she went to the ball. Only, none
of my vehicles will turn ugly again by midnight."

The 35-year old Bangladeshi car whiz replied to a BBC correspondent from the depths of his
garage while working on his Lamborghini. It is not every day that a Bangladeshi has a chance to
be “discovered” but one name that was showcased on Discovery Channel was Nizamuddin
Awlia Leepu. His unique designs were shown as well as appreciated at different auto shows
which took place all around the globe. Leepu had been working in automotive body design and
building technology since 1988, when he spent seven years in California as a car mechanic. He
came back to Bangladesh in 1998 and spent most of his time making new cars out of the bodies
of old ones, probably his own adaptation of Pimp My Ride, a popular western car show.

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Leepu's fascination towards cars came about when he was a child and went to a car exhibition in
Saudi Arabia. The maverick instantly fell in love with a Ferrari. When he grew up to realize that
the price tag did not agree with his wallet, he told himself that he would some design himself a
car just like a Ferrari. Unable to get the car out of his head, and unable to afford one, he learnt
the fine arts of automobile designs by himself. In 1989, he made the Leemo-bil, his own version
of his dream car the Lamborghini. He then went to create some look-a-likes of Ferraris. Car
lovers in Bangladesh soon got interested in his designs and whenever someone wanted unique
bodyworks to go over their dusty old car frame, everyone knew where to go to.
Finally Leepu has got some recognition for his distinctive car-making venture not from the
government; it came from a foreign TV channel. Discovery Channel proposed that he build two
unique cars within a timeframe. The proposed deadline was set at eight weeks. The whole
process was to be documented and aired on the Discovery Channel. Leepu got to work and the
end results were two beautiful sports cars. This whole herculean job was done to perfection by
him with a whole week to spare! Nevertheless, one has to give credit to Leepu for achieving
something that hardly anyone in the world has -- building two cars in seven weeks, a feat which
even shocked Bernie Fineman – the veteran in the auto trade for nearly half-a-century and who
has worked with Rolls Royce and Jaguar.

Over the years he got really good at it, but it eventually struck him that he didn't want to fake it
any more and that he "felt like a thief". He wanted to come up with his own designs, allowing his
creative juices to flow. Leepu has established a association between his designs and nature. For
Awila the end product isn't the most important thing. The actual creation of the piece itself, the
construction process that turns scrap into a thing of beauty, is the reward.

3.0 PROBLEM STATEMENT

The designs created by Leepu has worldwide acceptance; for the creation of a Bangladeshi
automobile brand targeted towards the middle income group, whether Leepu’s recognition can
accelerate the acceptability of the brand or not is unknown.

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4.0 BIG RESEARCH QUESTION
Will Bangladeshi middle income level people purchase the car made in Bangladesh.
4.1 Sub Questions
1. What are the driving factors that achieve this success
2. What type of car people are using right now.
3. To what extent affiliation of a foreign established automobile brand can enhance the
acceptance level of the local brand.
4. Will the upper middle and mid-middle income groups substitute their preferences from
more established foreign brands (Toyota) to a local brand.
5. Can a local brand capture the potential lower middle income market with a cheaper, due
to the tax advantage, yet reliable car.

5.0 OBJECTIVES

5.1 Broad Objective:

To evaluate the possibilities of Bangladeshi middle income level people will purchase the car
made in Bangladesh.

5.2 Specific Objectives:

1. To identify where a local car brand will stand competing with other established foreign
brands
2. To find out to what extent a local car brand can capture the potential lower income
market with the price advantage.
3. To find out to what extent a local car brand can capture the potential lower income
market with the price advantage.

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6.0 SCOPE
The research tries to look into the initial stages of establishment of a local car brand and the
preferences of the target market. The research looks into how much will the designer’s design
can effect the buying decision of the target market and the factors that are needed to consider
before designing a Bangladeshi Car Brand.

6.1 Source of Information:

1. Owners of Different Car Outlets in Dhaka
2. Middle Income group based in Dhaka
a. Public Service holder
b. Private Service holder
c. Self Employed
3. BARVIDA (Bangladesh Reconditioned Vehicles Importer’s & Distribution Association)

6.2 Types of Information:

1. Local brand acceptance.
2. Durability concerns
3. The extent of requirement of a stylish car
4. Features required
5. Priority features : price, feature, durability, style
6. Brand features
7. Concerns of the designer

7.0 LIMITATIONS

a. The research survey was conducted mainly on the people from Dhaka of required
income range. Buying preferences can be different for different for outside
Dhaka.
b. The research looks at initial preferences. Further research can take place in
creation of a brand image for the local brand.

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8.0 METHODOLOGY

This study assesses the utility of a local car brand to the middle income group of Bangladesh.
The research is cross sectional by nature. At the first phase qualitative research was undertaken.
This was covered through Secondary Literature Survey and Primary Qualitative Analysis. Two
car retailers were interviewed as one had the experience of dealing mostly with corporate clients
and the other having first hand experience of dealing directly with consumers. To assess the
utility of cars, initially identifying the underlying factors of utility that consumers seek from an
existing imported car is necessary. Thereby, matching with those features, additional different
features, which came out from a potential consumer FGD, were tested at different scenarios. The
FGD participants were of same age group but having different occupation. Thus varied
perception of consumers came into scenario. To assess all those factors and utilities, a structured
questionnaire was prepared to test the outcomes of the discussion. The questionnaire primarily
found out the need of a car to the respondent. Thereby assessing the validity of the respondents,
the utilities of a car is measured.

9.0 QUALITATIVE RESEARCH

9.1 Literature Review:

Literature on car assembly plants or even on cars is a rarity at a national level. However
Secondary data has been considered greatly from international publications.
1. Bangladesh Bank import payments: The import payments made for importing cars over
last 5 years.(Import payments Archive: (http://www.bangladesh-bank.org/)

13
2. Import tariff rates: Adjusted tariff rates on the import of different parts and raw materials
of automobile assembly of 2008. (Taxation Rate List: publication of National Board of
Revenue (NBR) 2008)
3. Case study of Proton: the establishment of the factory of Proton, required investments
and backing of the government, human resource development.
4. Geographical movement of new assembly factories and eleven assembly factors being
established in India after 1990, when the government of the country focused on trade
liberalizations and helped the process of foreign collaborationPublic Car Program(PCP)
in Philippines where for basic car for the mass public with an under 1200 cc engine was
introduced with a price ceiling
5. Geely Collaboration with UGANDA: the Uganda government, the Chinese government
and the car manufacturing company GEELY came under an agreement of setting up a
assembly factory in Uganda which will make cars affordable at a range of US$ 10,000;
US$5000 less than any car available in the market. The government has given away 300
acre land to the company and also awarded a ten year tax holiday.
6. Case Study of SAPA: the Irani car brand, locally named as peigan, which after it’s
introduction has virtually entirely substituted its sedan car market of the country. Brand
collaborations in India: India-foreign collaboration have created car brands specifically
for Indian mass to make it more acceptable.e.g. Ford has created ford icon.
7. Vietnamese car market.( The Automobile Industry in Vietnam: Kenichi Ohno, Vietnam
Development Forum)

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 Figure: The Benefits of Proton in Malaysia

9.1.1 Specific Findings of the Secondary Research

1. Assembly factories even enter market where they are producing more than the demand as
because the south asian markets with its potential of economic growth should increase its
market base in coming years. (Case of India)
2. Government needs to provide substantial support for the initial establishments and also in
accumulating funds. (Case of Proton)
3. Government has to provide tax benefits, tax holidays and decreased import taxes on raw
materials and heavily tax all imported vehicles. (Case of all assembly plants established
after 1990)
4. Taxation study of import tariff rates of car manufacturing sub units show that even if the
factory has to import all the major sub units such as the engine and the chasis from
outside, the car can still have a markup price of minimum 25% less than available cars of
the same engine power.
5. Bangladesh has an average light vehicle consumption of 10000 units and more making it
very eligible to have its own car assembly plant given the economic growth of the
country remains stable.
6. Country looses over US$300 million of annually for importing cars and an assembly
factory can work as the potential import substitution.
7. Creation of a niche market is possible for lower mid income group who currently cannot
afford a car because of high import taxes and avail public transport.

9.2 Qualitative Research Findings:

In the next phase the researchers conducted the primary qualitative research to identify the
fundamental aspects which are expected to affect the inception of an assembly plant in
Bangladesh. The findings from primary quail are elaborated below:

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 • Bangladeshi people have not yet experienced scientific aspects and technicalities (i.e.
Aerodynamics) of automobile manufacturing which is a major drawback. A
feasibility study needs to be undertaken as well.
• According to manage required financial back up and land for the huge project will not
be less difficult than tackling the problems created surrounding the government
legislation. A professional and dedicated government body needs to be made
functional to monitor _______________.
• The most vital factor will be that the car has to be economic if it targets the middle
income group.
• The authenticity and uniqueness of a modified car will be one of the most convincing
features, ‘Wow Factor’ as quoted from Leepu, in case of a locally made car.
• This industry has enough reasons to be called as a ‘risky venture; as there will be
questions raised regarding longevity, reliability and quality of a local brand , so these
aspects needs to be addressed most carefully.
• Leepu feels the need of more automobile engineers which he believes needs to be
produced more. He agrees to train the skilled and semi-skilled manpower required for
the functioning of the industry.
• The ultimate goal which Leepu considers to meet is to apply the concept of ‘People’s
Car’ tailored in a way so that it attracts the automobile customer base of Bangladesh.

9.3 FGD with some Professionals Representing Middle Income Group

A focused group discussion with some young professionals, who represent middle income group
provided the researchers adequate knowledge on the expectations from a local car brand. The
almost one hour long session was attended by Mr. Rubaiyat Hasan Siraz (MNC Executive), Mr.
Ruhul Amin (MNC Executive), Mr. Abhishik Paul (MNC Executive), Mr. Rubaiyyat Thakur
Robin (Entrepreneur), Mr. Shakib Ahmed (Private Service Holder), Mr. Asif Newaz
(Entrepreneur), Mr. Mostafizur Rahman (Private Service Holder) and Mr. Tarek Abdullah (MNC
Executive). Findings from the FGD are listed below:

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• When asked about the fundamental aspects which they find most significant while
purchasing a car their response entailed-
o Price
o Brand
o Design
o Resell value
o Fuel Efficiency
o Engine Power
o Origin
o Serviceability
o Availability of Spare Parts

• When asked about the preferred origin of a car most of them responded for Japanese and
European Cars.
• Most of the discussants agreed that their purchasing decision might get influenced when a
local car is offered at 25% less price, although a few of them demanded further reduction
(up to 40%).
• Most of the participants think price for a local car should not exceed BDT 6-7 lakh.
• While asked for the required features the following came forward:
o Design
o Fuel Efficiency
o Built in CNG Engine
o Easy availability of Spares
o Price
o Serviceability
o Resell Value
• The required engine power was 1500cc for the most and they expect the engine to run
more than 8 km/ltr.

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• Most of the participants were willing to pay a marked up price for servicing as for
originality but will not buy a local car if spares are costly.

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10.0 CONCEPTUAL MODEL

Assurance of Resell
Brand
Origin of the reliability Value
Preference
car Price Design

Switch to local brand

Design
acceptance
Transport Cost
Acceptability of local brand
Buying decision
Lower changing ratio
incomen Designing
Leepu’s Success
iche Local brand
Affordability market
range

Establishment Expected
Pricing
Local Car Brand Features Transport
Preference

Feature
Middle Income Group Preference

Origin
Preference

Preference
Income Maintainability DifferencesD Design
transport Sd Preference

Modification
Pride Tax Brand Preference
Transport
Cost Concerns Advantage Preference
Designer Effect
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12.0 QUANTITATIVE RESEARCH

12.1 Sampling Plan

The research, at the quantitative analysis stage, utilized the non-probability sampling techniques.
The basic survey method was door-to-door. Convenience and Snowball sampling techniques
were used in this survey. The total duration of the survey was 3 days, starting from August 22,
2009 to August 25, 2008. The total number of respondents approached was 57, out of which 50
responded. All of the respondents are employed, either self or public/private. Each response was
recorded, on an average, in 5 minutes. To consider the sample to be an adequate representation
of the potential market, the sampling frame included respondents of each tire of middle income
group and each occupation.

12.2 Sample Characteristics

The sample respondents included around 15% female and 85% male. The modal age bracket was
28 – 37 years. Most of respondents were from Lower tire of the middle income group, who will
be the prime beneficial of a Bangladeshi People’s Car.

12.3 Survey Instrument

The survey questionnaire used as data collection instrument had in total 14 questions as well as
the respondent,s profile. At the initial stage, the respondents replied their existing transportation
scenario. Thereafter, the need of own car aroused and thus the respondents answered the next
questions considering their own need. All these questions were focused to find out the prime
utilities of a car and the impact on consumers of a local brand. A hypothetical scenario of price
factor was considered by the respondents and thus the research cross examined the perceived
utilities. The next section was only for the existing car owners to see whether they will switch to
the local brand. The survey questionnaire was ended by extracting some sensitive issues like
monthly income and age bracket.

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RECOMMENDATIONS:

1. There is positive small correlation between people’s necessity of having own car and
their income level

2. In terms of buying a new car, purchase decision is based upon (in descending order):

a. Price

b. Brand

c. Engine Power

d. Fuel Efficiency

e. Resell Value

f. Design

g. Origin

h. Serviceability

i. Availability of Spares

3. In terms of perception, Bangladeshi People prefer Japanese car most.

4. If a Bangladeshi Brand comes into the market, it has to be very much price competitive.
The respondents did not shift much from Japanese car even if the local one was running
on a Japanese Engine. When price reduction is done, then only the responses can be
shifted towards Bangladeshi Car

5. The respondents believe Bangladeshi Cars will not be better than Chinese Origin and will
at par with the Indian Ones.

6. Pride Concern regarding the use of a Local Car Brand is very high among the
respondents.

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7. Some segments of the people would buy local car brand due to the fact that it helps the
national economy

8. The Prime Threat for a Bangladeshi Brand to be established is the Assurance of

Reliability. The other factors are listed in descending order:

a. Existing Brand Preference

b. Resell Value

c. Origin

d. Price

9. For a sustainable Bangladeshi Brand of automobile the following factors are needed to be
considered according to the order:

a. Fuel Efficiency

b. Price

c. Availability of Spares

d. Built in CNG Engine

e. Serviceability

f. Design

g. Resell value

10. The expected engine power of a Bangladeshi car is 1500 cc

11. People having own car now, would like to buy a local brand as their second car instead of
replacing their existing imported one.

12. Most of the respondents believe that the government should impose higher taxes on car
imports in order to encourage the local car brand when it will be established.

22
ACCEPTANCE MODEL

23
Figure: The Acceptance Model for Local Car Brand to the Middle Income Group of Bangladesh

24
CONCLUSION

The country can get benefitted through the creation of a car brand and an assembly plant of its
own. The demands required can be met up by one assembly factory and it can be financially
feasible. The findings of the research include factors showing price to be the major determinant
factor of a buying decision over other features and it has to be considered with importance.

The model shows the inclination of the middle class group towards using a reliable car brand,
and price is the factor which only supersedes and brings it under acceptability terms. Also the
factors relating to pride concerns necessarily prove that nationalistic sentiments pervade within
the segment and the brand attribute of the car has to have these features under consideration. The
basic features demanded with a measurement of utility have been also shown attributing to the
basic buildup features of the car.

Although feasible, the actual establishment of a plant will need to look into factors of collecting
capital, training skilled human resource, designing and innovation and most importantly
government’s role under consideration. These aspects can individually be looked into in depth.

Considering the multiple socio-economic benefits Bangladesh can potentially receive from it
with the flip side of saving huge losses of foreign exchange each year used to importing cars,
Bangladesh should be walking towards creation of such an establishment.

25
Appendix 1

Working Definition

Working Definition:

Middle Income Group

Middle Income group consists of three segments of income group.

Upper Middle: Individual earning a monthly income of BDT 100,000—200,000

Mid-Middle: Individual earning a monthly income of BDT 60,000—100,000
Lower-Middle: Individual earning a monthly income of BDT 20,000—60,000

Acceptability

The quantitative measurement of the number of people substituting their buying decisions

between a choice of imported cars and a local brand considering the given variables of new

pricing of cars.

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Appendix 2
Questionnaire

Q u e s t i o n n a i r e Sl. No.

This Questionnaire is Prepared as a part of a Research to Identify the Level of Acceptance of a Local
Car Brand to the Middle Income Group of Bangladesh. This research is undertaken by few students of
North South University (NSU). All the information provided here will be extremely confidential and
will be used for Academic Purpose (This Research) Only. We request your kind assistance and hope to
get valid information. Thank You!

Please Use [] Mark for the appropriate answer out of multiples * = Optional
01. Is your monthly income in the range of BDT 20,000/- to BDT 200,000/-?

YES NO

02. Please Rank the following means of transport by which you travel the most?
[1=Most Frequently, 7=Least Frequently]
Ricksha CNG Bus Non A/C A/C Motorcyc Family
w Autoricksha Taxi Taxi le Car/Own
w Car

03. Being in your current status, you need to have your own/new car –

Strongly
Disagree Indifferent Agree Strongly Agree
Disagree

04. For your choice of a car please rank the following aspects according to your
importance-
[1=Most Important, 9=Least Important]
a. Design
b. Engine Power
c. Origin
d. Price
e. Brand
f. Serviceability
g. Fuel Efficiency
h. Resell value
i. Availability of Spare Parts

05. In terms of your preference of Origin of a car, please rank the following regions

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 according to your perceived reliability- [1=Most Preferred, 7=Least
Preferred]
Korea/Malay Banglad
Japan China India Europe America
sia esh

06. If the Bangladeshi Car is running on a Japanese Engine which car you would
prefer?
Bangladeshi
Japanese Car It Depends Indifferent
Car

07. Is using a car of your country a pride concern to you?

Strongly
Disagree Indifferent Agree Strongly Agree
Disagree

08. If you know that your country will be economically benefited if you buy a local
car,
will that affect your purchasing decision?

Strongly
Disagree Indifferent Agree Strongly Agree
Disagree

9. If you are buying a Bangladeshi Car, please rank the advantages you would look
for-
[1=Most Preferred, 7=Least Preferred]
Fuel Built in Easy
Desig Serviceabil Resell
Efficien CNG Availability Price
n ity Value
cy Engine of Spares

10. What should be the ideal engine power of a local car brand?
2000 More than
1000 cc 1500 cc 1800 cc 2000 cc
cc

11. Considering the engine power you preferred in the last question, what should be
the ideal
fuel efficiency (with AC) for Leemobile?
Less More
5 6 7 8 9
than 5 than 9
km/liter km/liter km/liter km/liter km/liter
km/liter km/liter

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12. Would you like to see the government imposing higher taxes on car import if a
local brand
is established?

YES NO Indifferent

Please answer the following questions if you currently have your OWN car.

13. Would you like to sell your existing car to buy YES NO
a new local car?

14. Would you like to buy a local car as your YES NO

second car?

Respondent Profile:

15. Name*:
16. Gender: Male Female 18- 28-37 38-47 48-57 57
38. Age: 27 +

17. Public Private Self Unemployed

Service Service Employed
18.Occupation:

19. Your Average Monthly Income (in the range of):

[In BDT]
Less 20,000- 60,000- 100,00 More
Than 59,999 99,999 0- Than
20,00 149,99 150,00
0 9 0

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REFERENCES

ASIAN AUTOMOTIVE NEWSLETTER Issue 45, December 2005

Bangladesh Bank (2005), Import payments Archive, http://www.bangladesh-bank.org/

CAR ASSEMBLY PLANT TO OPEN IN UGANDA, WHITAKER GROUP PUBLICATION

WINTER 2007-08, Uganda%20Update%20WIN%2007-08.pdf

Dato’ H.S.Z. Tahir (1992) Developing Human Capital at PROTON

Humphrey J. THE GLOBAL AUTOMOTIVE INDUSTRY VALUE CHAIN, Institute of

Development Studies, UNITED NATIONS INDUSTRIAL DEVELOPMENT
ORGANIZATION

Kenichi Ohno, The Automobile Industry in Vietnam, Vietnam Development Forum

National Board of Revenue (NBR) (2008), Taxation Rate List
Rafaelita A. Mercado-Aldaba, Micro Studies: Philippine Car Assembly Sector,
DISCUSSION PAPER SERIES NO. 97-21, September 1997

Yuri SADOI, Skill Formation in Malaysia: The Case of ·Auto Parts Industry, Southeast
Asian Studies, Vo1.36, No.3, December 1998

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