Sathosa Motors to set up assembly plant at H'tota

Sathosa Motors PLC hopes to set up an assembly plant for Izuzu and Land Rover pick-up trucks at the Hambantota port this year, said Sathosa Motors PLC, Executive Director, Tilak Gunesekera at the Annual General Meeting of the company last week.

He said negotiations are under way with Izuzu, Thailand and Land Rover, Thailand to set up the project at the port in the South. He said the investment for the project cannot be divulged as negotiations are continuing.

Sathosa Motors will invest on new projects and capital expansion during the next two to three years, Gunasekera said. The company incurs a cost of Rs. 16,000 to transport a vehicle from the Hambantota port to Colombo. Commercial vehicles are not rolled-on and rolled-off at the Hambantota port.

Gunesekera said that the import duty on pick-up trucks is yet high and added that it is around 151 percent which is the highest in the world.

Motor vehicle importers have called upon officials to revise the import duty on vehicles that will enhance revenue to government coffers. “We wrote to President Mahinda Rajapaksa who has referred the matter to the Secretary to the Treasury Dr. P.B. Jayasundera. We hope that there will be a revision in vehicle import duty at the next budget,” Gunesekera said.

Vehicle sales have plunged by around 50 percent due to the exorbitantly high import duty. Revenue from import duties on motor vehicles declined by 50 percent from Rs. 28.40 billion in 2011 to Rs. 14.10 billion last year due to the depreciation of the rupee and measures to curtail imports.Gunesekera said that a major achievement of the company last year was the introduction of buses and cabs to its range of vehicles due to the partnership with Izuzu, India. Profit after tax of the company for the financial year 2012/13 was Rs. 205,722,000 .