Group members

Maryam Tariq
Hamza Sidiki
Syed Shan Alam
Mansoor Ahmad Khan
Murtaza Akhund

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• Honda Atlas Cars(Pakistan) Ltd. is a joint venture between Honda
Motor Company Ltd., Japan & Atlas Group of Companies, Pakistan
signed on August 5, 1993.
• Collaborations was done for the development of parts and systems
for manufacture of Honda Cars in Pakistan.
• Pakistani and Japanese cultures have blended exceptionally well to
form a professional team of dedicated specialists.
• HACPL keeping its promise to come upto the customer's
expectations and to give them money's worth

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 Dynamic Manufacturing and marketing of prestigious products
to the entire satisfaction of customers.

 Create ideal working environment for continuous development

of product and personnel.

 Provide adequate return to shareholders and fulfill corporate

civic and fulfill corporate civic obligations.

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 Honda Atlas Cars Ltd. is rated very high in tons of efficiency,
quality and working condition.

 The buildings of HACPL are neat & beautiful and the security
system is very tight.

 "Equality" is a significant feature of HACPL.

 Special coasters have been hired for travelling of employees

between Lahore and factory.

 Mosque and canteen is present in factory premises.

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Product Plans
 Assemble to order strategy

Competitive Priorities
 Low cost
 Consistent quality
 On time delivery

Process Design
 Labour + Moderate technological intensive.

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Material Management
• Formal Supplier Relations.

Production Plans
• For 1 month.

Scheduling
• Planned for ahead.

Capacity
• Lower utilization.

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• HACPL has a network of 14 dealers. Out of
these, 7 dealers are located within a radius of 400
km from the factory.

• HACPL has an edge over Indus company ( the

manufacturer of Toyota) in this regard.

• Dealers of two cities (i.e. Karachi and Hyderabad)

fall within a radius of 400 km from the factory.

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 A large number of industrial units are operating
here and this along with the presence of many
technical training institutions have contributed
towards the provision of abundant skilled
labour.

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• The place where factory of HACPL is located, is rapidly
becoming an industrial zone.
• Electricity, telephone, etc are also easily available.
• Honda Atlas Cars (Pakistan ) Limited, tries to reduce the
transportation cost through the following ways:
-HACPL prefer that vendor who supplies material at the
HACPL's destination (plant) while remaining in suitable
price and quality ranges.
-HACPL charges Ex-factory rate for its product from
customers. The customers have to bear the transportation
cost from plant to the respective dealer of their city.

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 Honda Atlas Cars (Pakistan Ltd. has a separate production
department which is headed by Vice President (Production).
The production department has a number of sections such as

 Vendor Section
 Engine Section
 Welding Section
 Maintenance Section
 Paint
 Vehicle quality control.

These along with some other sections are arranged in four

groups, each one headed by a Gm.

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 Currently the plant has the capacity of 35 vehicles per day
which is lower than that of Toyota. As for as the
production level is concerned, it varies from time to time.

 It was 15 cars per day at the factory. This shows that the
plant is being underutilized. There may be several reasons
for this under-utilization such as weak economic condition
of the country, decrease in the purchasing power of
potential customers, et cetera

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 A brief list of machinery used in HACPL is given below
 Boilers
 Compressors
 Water treatment plant
 Ovens (for backing the body of cars)
 Spot welding guns.
 Two-post lifts
 G-SWAT/ B-S / S Side Slip / Shower testers

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Various parts of vehicles are

 Brakes
 Seats
 Lights
 Cooling System

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   The production procedure starts from welding. This is done with the help
of special machines. In this way the basic frame is manufactured and is
transferred to painting section.
 The painting section is equipped with modern machinery. Here, the process
starts with wiping, cleaning and degreasing of frame which are followed by
Phosphate and ED coating. Now the frame is backed in special ovens.
After backing, following coat are applied:
  Base coat
 Final coat
 Clear coat (for shining)
 After painting, the frame is shifted to assembly line. Here ornamental parts
such as lights are fixed followed by heavy parts like engine, tyres seats,
wind shield, etc. The procedures at assembly line can be understood by
figures mentioned earlier.

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 After passing through assembly line, the car moves to "vehicle
quality department". Here, different tests are applied.
Currently, HACPL is using three QAEs (Quality Assurance
Equipment)
 After applying these test, the car is driven an a 1-km "test
course". Here the noise and performance of car an different
road conditions are tested. Finally, a "shower test" is applied
to find leakages if any.
 In this final stage, pre delivery inspection (PDI) is made and a
sticker is attached. Now, the car is ready for shipment.

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 A lot of importance is given to " quality control" in HACPL. The personal
of HACPL is highly qualified in this regard.
 When purchase material arrives, thorough checking of that material is
made. If any deficiency is found then it is reported.
 Similarly, the finished product is tested before delivering it to the customers
in order to assure the quality standards.
 HACPL is successfully using "Kaizen" system for quality control.
Employees are encouraged to improve quality and reduce cost. Every
month, about 20-25 prizes are given on showing good performance.
 HACPL is ISO 9002 certified. It was the winner of "Best Quality Award
for Asia" in 1996,1997 & 1998.

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 The role of R&D is to introduce innovative ways to achieve the
objectives especially through production facilities.
 Unfortunately, there is no research and development
department in HACPL.
 This function is performed by Honda Motor Company, Japan.
All major changes in models of Honda cars are introduced
there.
 Employees of HACPL are sent to Japan, where they are trained
according to new conditions. Later on, these changes are
introduced in the models offered in Pakistan.

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 HACPL is persuing a realistic and progressive deletion
programme for indigenisation of assemblies, parts and
components.
 This dynamics programme is being implemented through in-
house assemblies and manufacturing operations, and is being
supplemented by vendor development.
 HACPL is almost same as that of its major competitor, i.e. the
manufacturer of Toyota Cars. Efforts are being made by top
management to increase this percentage.

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The production department of HACPL is playing a vital role in achieving the
overall objectives of the company through efficient utilization of resources.

  HACPL is achieving production efficiency through:

 Evaluation & improvement of quality control.
 Training of production employees.
 Modernization of plant and machinery

Similarly cost minimization objective is being achieved through:

 Deletion programme
 Avoiding poor quality products, which are a loss for the company. As
mentioned earlier, HACPL is achieving excellent quality levels through
giving training to personal plus proper use of technology.

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 Inventory is a stock of any things held to meet future demand. Inventory is
created when the rate of receipts exceeds the rate of disbursements. It is
depleted when disbursement exceeds receipts.
There are three types of inventory:
 Raw material inventory
 W.I.P. inventory
 Finished goods inventory.

The basic objective of any firm is to minimize total inventory cost (ordering &
carrying). The same is the case in Honda Atlas Cars (Pakistan) Limited. In
HACPL, the whole inventory system is computerized. Following are the
advantages of this computerized system.
 Updating records.
 Providing management reports.
 Automating the recording process.
 Re-computing decision parameters.

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HACPL maintains a safety stock of 2 to 3 months. The reason for
maintaining a safety stock is as follow:
 To protect against shortage that occur due to suppliers.
 To protect smooth and continuous operations.
In HACPL, the inventory is held in the following forms:-
 Inventory of imported parts.
 Inventory of local parts.
In order to avoid stock out, they have more safety stock of
imported parts as compared to that of local parts.

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 Shortage Of Inputs
There are special warehouse for the purpose. Both imported and
local parts are stored here.

 Storage Of Output (Cars)

There is no proper warehouse for parking of cars moving out of
assembly line. A place has been assigned for this purpose but
there is no roof over it.

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 Purchasing in the management of the acquisition process
includes deciding which supplies to use, negotiating
contract and deciding whether to buy locally or centrally.

 Purchasing must satisfy the firm’s supply needs and

support the firm’s production capabilities.

 HACPL imports materials from the parent Honda Motor

Co, Japan in the CKD (complete Knocked Disk) form and
also from the Local Vendors.

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 HACPL prefer those suppliers who fulfill the
following requirements:

• Provide best quality material at low cost.

• Shorter Lead Times
• Provide material to production plant of HACPL. (i.e.
provide material at destination).
• On time delivery

These are the reasons which forces HACPL to go for

local contracting.

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 To store the finished products, (Honda Civic & Honda City),
HACPL uses both FORWARD BACKWARD PLACEMENT.

 HACPL has a country-wise network of Sales Dealers who are

actively engaged in promoting the image of HACPL and its
cars.

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