Table of contents list of acronyms
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| Table 7.7 VENDORS SHARE IN SUPPLY OF PARTS % Formal Informal 0-20 27.3 66.7 21-40 40.9 16.7 41-60 13.6 8.3 61-80 4.5 8.3 81-100 13.6 0.0 Total 100.0 100.0 Source: Estimated from Survey Data. 71 Likewise, the auto part manufacturers do not necessarily sell to only one OEM. Formal vendors are those manufacturers whose share of sales to OEMs is more than half. The average share of sales by formal vendors to OEMs is 66 percent. The extent of competition among informal suppliers to the retail parts market is quite intense, with two-thirds of the sample reporting market share of less than 20 percent. In the case of formal vendors, OEMs have avoided creating conditions of monopsony by diversifying their sources of supply for most parts. This has increased their bargaining power with respect to vendors. On top of domestic competition, sales in the replacement market are not subject to strict quality control standards, as determined by us through a survey of five autoparts dealers in Lahore. In this market, consequently, local vendors face severe competition at the lower end of the market from imported (or smuggled) parts from China and Taiwan. At the upper end of the market, there is more competition from high-quality parts imported from Malaysia and Thailand. Download 0.77 Mb. Share with your friends:
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