LAHORE - Vehicle prices may go up by Rs 50,000 to Rs 60,000 while complying with Euro II standards as OEMs now have to change older carburetor-based engines to new EFI engines with exhaust system including catalytic converter.
Thus, this necessity will increase OEMs manufacturing costs as they would have to invest in Euro-II engines and catalytic converters in economy segment of the new vehicles.
Industry sources said that Euro-II compliance will also require oil refineries to invest more and Oil Marketing Companies have to import Euro-II fuel at higher cost, which will increase public transportation cost for consumers as well.
It is to be noted that a catalytic converter is an exhaust emission control device that converts toxic chemicals in the exhaust of an internal combustion engine into less toxic substances.
And because of the use of precious metals in the converters like Platinum, most active and much in use, Palladium, Rhodium, Cerium, Iron, Manganese and Nickel, they are expensive. So it’s natural that their installation in the cars after July 1 will have impact on the prices.
Similarly, EFI engine is one of the main components for Euro-II compliance. Fuel injection generally increases engine fuel efficiency. With the improved cylinder-to-cylinder fuel distribution of multi-point fuel injection, less fuel is needed for the same power output (when cylinder-to-cylinder distribution varies significantly, some cylinders receive excess fuel as a side effect of ensuring that all cylinders receive sufficient fuel).
Needless to say, most of the countries in South Asian region have already adopted these standards that are being continuously and progressively upgraded since the middle of nineties with the main focus of achieving reduction of pollutant gases in exhaust emission.
‘In the end, it is the consumer that has to feel the responsibility and pay for better, safe environment,’ said the industry sources, adding that this will make the consumer follow the environmental standards that are already being implemented in many countries of the world.
However, the local car manufacturers are in a dilemma as on the one hand they are all set to produce high cost environment friendly European standards (II) vehicles from July 1, and on the other they are facing the brunt of continuous depreciation of Pakistani rupee against all major currencies.
‘In both situations, the car manufacturers have to increase the prices of new vehicles a bit to stay afloat in this time of recession,’ sources added.