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PAKISTAN ACCUMULATORS PRIVATE LIMITED

Table of Contents
Executive Summary...............................................................................................................................2
Introduction...........................................................................................................................................3
History & Overview of Industry........................................................................................................4
The Market of Pakistan Accumulators...............................................................................................4
Production Process (Assembly Line).....................................................................................................5
Interdepartmental Process Flow.........................................................................................................6
How do they compete (Variety, Price, Speed & Quality)?................................................................7
Fixed Schedules vs Flexibility Offered to Customers........................................................................7
Process Flow & KPIs for Performance Measurement........................................................................7
Productivity Standards.......................................................................................................................8
What are they doing for improvement (process/product)?.................................................................8
Manufacturing Processes...............................................................................................................8
Capacity of Plant at Different Levels.................................................................................................9
Assessment of Working Environment...................................................................................................9
Challenges faced by Organization.........................................................................................................9
Analysis & Recommendations.............................................................................................................10
Executive Summary
This project required a strenuous effort from our group members but under the guidance and
instruction of our esteemed instructor Mr Hassan Rauf, we believe we have articulated a
viscid and comprehensive analysis of Pakistan Accumulators Pvt. Ltd (PAL) keeping in view
the Assessment of Product – Process Fit. A general context of the organization is presented in
the report. We have also interviewed Mr Iftikhar Hundal (GM Factory/Production) to
conduct a detailed production analysis of PAL. Mr Hundal has extensive working experience
spanning over 30 years, starting as a Plant Supervisor and later landing a job in Pakistan
Accumulators as Unit Manager. He has progressed over time with the organization and is
currently serving as GM Factory/Production. It is important to note that the year 2020 proved
to be tough and challenging for all the companies in Pakistan as it was bogged down by
unusual and challenging circumstances, many of which were directly or indirectly the result
of the COVID-19 pandemic.

Introduction
Pakistan Accumulators is an ISO 9001 and 14001 certified company; it has been
manufacturing various types of automotive, inverter, and specialized batteries from 3 Amp to
3500 Amp, under the brand name “Volta” and “Osaka” for more than 27 years. They also
launched a third brand “Fujika” to cater to the market needs. The company is the market
leader in terms of volume and revenue generation compared to other companies, holding 35-
40% of the battery market.
The company provides all types of motorcycle batteries ranging from 04 AH, 6 AH, 8 AH, 10
AH, and Supreme four-valve regulated lead-acid (VRLA) maintenance-free motorcycle
batteries, while the automotive batteries range from 32 Amp to 240 Amp. The company takes
pride in being the only local manufacturer for all types of Maintenance-free Batteries, ranging
from 32 Amp to 200 Amp. It operates a 15-acre state-of-the-art manufacturing unit in Hattar
Industrial Estate, Haripur to manufacture quality products. The head office is in Islamabad
and is supported by 7 regional offices in Karachi, Lahore, Peshawar, Multan, Rawalpindi,
Faisalabad, Sukkur, and Hyderabad. This has enabled it to effectively cater to the customers'
needs.
Type of Business: Pakistan Accumulators Pvt Ltd deals with the Manufacturing as well as
Selling and Marketing of the batteries.
Vision: “A customer’s trust-winning company believes in quality products through
continuous research and Development ensuring sustainable returns to stakeholders.”
Mission: To provide trustworthy and economical power solutions for everyone.
Core Values:

 Integrity and Credibility

 Honesty and Accountability
 Sense of Ownership
 Motivation and Team Work
  Speak from Heart
 Innovative Thinking
 Friendly Environment

History & Overview of Industry

In 1860, the Frenchman Gaston Planté (1834-1889) invented the first practical version of a
rechargeable battery; it was a lead-acid battery using lead and alkali as major ingredients
along with diluted sulphuric acid. Although the practical battery was made quite earlier, its
commercial application in cars was first started in 1918 when Hudson Car Company first
used it in its vehicles to power electrical equipment such as lights.
There was no battery manufacturing plant in Pakistan at the time of independence in 1947,
due to which car batteries were imported from the UK, namely Exide and Lucas brands. This
changed in 1953-54 when the first battery manufacturing plant was established by the Hashoo
Group in Karachi under the name of “Chloride Batteries”. It later transitioned to Exide
Pakistan and was the first local plant for both East Pakistan (present-day Bangladesh) and
West Pakistan. As the population and per capita income of people increased, the demand for
batteries increased both for cars and commercial use.
The second local battery manufacturing plant was AGS, owned by Atlas Honda Group; it was
established in Karachi in 1960. It is well known for producing quality batteries and
considered to be the high-end battery brand of Pakistan. Along with Exide Pakistan, AGS
held a monopoly over Pakistan’s battery industry for the next few decades.
The third and currently largest manufacturer of batteries in Pakistan is Pakistan Accumulators
Pvt. Ltd. It was established in 1993 at Hatter Industrial Estate, Haripur to cater to the ever-
increasing demand for batteries in the country. They are currently operating with 3 brand
names: Volta, Osaka, and Fujika Batteries.
The fourth brand to enter the market was Pheonix Batteries. The company was founded in
Karachi in 2007 and is primarily focused on the manufacturing of UPS batteries.
Pakistan’s battery industry saw a boom when the whole nation saw energy crises in 2007-8,
which caused the demand for UPS and household batteries to soar. Since then, such battery
manufacturing companies have increased their plant capacities to meet the demands of the
market.
Pakistan’s battery industry has seen seismic levels of transformation over the years, having
transitioned from manufacturing lead-acid batteries to maintenance-free batteries. It was a
transformation spearheaded by Pakistan Accumulators, which was the first company to
introduce maintenance-free batteries in Pakistan. These batteries used calcium as the main
ingredient and were sealed from above. They were revolutionary as they did not require
refilling of acid and had an average life of 1.5 to 2 years.

The Market of Pakistan Accumulators

Pakistan Accumulators has its regional offices present in Karachi, Lahore, Peshawar, Multan,
Rawalpindi, Faisalabad, Sukkur, and Hyderabad, and its product coverage is spread all over
Pakistan. Other than serving the local market, PAL is also the largest exporter of batteries
based in Pakistan and serves 20+ locations, primarily Afghanistan, Yemen, Sudan, Djibouti,
the Far East, the Middle East, Central Asia, and South Asia.
Main Products (All types of Lead Acid Batteries)

 Lead Acid Dry Charged Battery (JIS Standard)

 Lead Acid Dry Charged Battery (DIN Standard)
 Car Battery
 Truck Battery
 Inverter UPS Battery
 Maintenance-Free Battery
 Motorcycle Battery
 VRLA Battery (FMX Series)
 VRLA Battery (GFM Series)
 Battery Tonic (Distilled Water)

Commodity vs. Innovation Products: The proportion of production of Commodity vs

Innovative products is 80:20.

 Commodity Products: All types of lead-acid batteries, mainly dry-charge,

maintenance-free, and motorcycle batteries.
 Innovation Products: Tubular batteries and valve-regulated acid-filled batteries
(VRLA).
Pricing

 The average price of a battery is around PKR 7,500.

 The minimum price is of motorcycle battery Supreme 4, i.e., PKR 750
 The maximum price is of Tubular Battery model TA-3000, which is priced around
PKR 36,000.

Production Process (Assembly Line)

In the production phase, the battery components (such as the case, lid, grid, etc.) are produced
in a batch process and are then gathered at the assembly line. While the production of the
battery components is produced in a batch process and can vary in types ranging from 1 to
50, the assembly line itself is operated in a continuous process. The process’s chart is given in
Exhibit 1.
The assembly line consists of 15 steps. The first step is stacking, in which the battery
components are gathered at the assembly line to assemble and test the batteries. The second
step is group welding of plates into cells. This is then followed by the inspection of the
cells. The batteries then undergo a short circuit test to determine the circuit parameters of
each cell.
The next step is inter-cell welding in which the individual cells of a battery are connected by
fusing their lead straps. This is followed by the shear test which is done to evaluate the
strength of the container to make sure that it does not get damaged when in use, after which a
cover is placed on the container of the battery and is then heat sealed.
The following step is the terminal building of the batteries which then undergo a leakage
test under high air pressure. After the batteries have been assembled and tested, the batteries
are then coded; the coding is done as:

(Year-Month-Date-Shift-Line)
The holes of the batteries are then taped using foil in place of vent caps, packed, and then
are stacked/palleted using plastic wrap and wood pallets, and are then subsequently stored.
The average process time is 1 hour for a finished good with a wait time of 5 minutes. The
company’s average production run ranges between 15 and 20 days when they have excess
raw material and idle machinery. Furthermore, the company’s plant utilization ranges
between 70% and 75% with buffer work in process inventory of 1 week. Raw material
availability is for 1 month.

Interdepartmental Process Flow

The macro-level process flow is the organizational or interdepartmental process flow. The
organizational process flow starts from the sales department. In sales departments, sales
managers are responsible for order generation and increasing the market base. The sales team
has operations managers as well as exports managers. They are taking orders from the local
as well as international market.
The sales department is linked with the planning department. The general sales manager is
communicating the sales numbers to the planning manager. The planning department will
work on the sales forecast and actual orders taken by the salespeople.
The planning department is linked to the procurement as well as the production
department. The planning managers will ask procurement managers to procure the raw
materials depending upon the sales numbers. On the other hand, the planning manager is
responsible for communicating the production plan 1 day before the actual production so that
the production department can do all the preparations. Depending upon the production plan
given by the planning department, the production department starts its operations. The
production department constitutes of the alloy blending, moulding sections, and assembly
line.
The production department is then linked to the storage department, which stores the
batteries. The storage department is also responsible for transporting the batteries to the local
distributors. However, for international distributors, Pakistan Accumulators use brokers and
good transport companies.
 Sales
Department

Planning
Department

Procurement Production Storage

Department Department Department

How do they compete (Variety, Price, Speed & Quality)?

Among the battery companies in Pakistan, Pakistan Accumulator has the highest production
capacity with state-of-the-art machinery and labour. As a result, the company packages its
batteries and all materials required are made in-house which helps them save time and gives
them an edge to compete on Speed and Price.
The company is also the only battery producer in Pakistan which manufactures all 9 types of
batteries of different sizes, thus boasting a high level of Variety. Coupled with strong
quality checks, Pakistan Accumulators has managed to secure the number one spot in
Pakistan’s battery industry in terms of volume and sale.

Fixed Schedules vs Flexibility Offered to Customers

Production schedules are normally fixed and there is a little chance of customization.
However, if a new customized order comes in, the customer is normally given a time of 15 to
20 days for delivery.

Process Flow & KPIs for Performance Measurement

Planning is the most important element of the production process of Pakistan Accumulators.
It is done at the start of their fiscal year in June. Their fiscal year starts in July and ends in
June next year. The planning report is for the whole year and is keenly made based on
demand and sales forecast keeping in view the previous year’s sale trend. After the report is
made, it is approved by all the concerned departments like supply chain, operation,
production, storage, etc. Extensions in the production plan can be made during the year in
case of any unexpected demand.
Based on yearly planning, monthly planning is also done. It depends upon the already
existing stock in the stores and forecast for next month. They do not hold too much inventory
of finished goods and try to make the required variety and quantity of batteries each month.
Their average daily production is around 9000 units of dry-charge, almost a similar number
for Motorcycle batteries, average 2000 units for maintenance-free, and rest depend upon the
orders at hand. They have a total of 5 operational plant units, one each for dry-charge,
maintenance-free, tubular, VRLA & motorcycle battery, and battery tonic.
The KPIs for performance measurement is based on targets. Each assembly line has
production checks. They have daily and monthly targets to achieve. Every line has different
production capacities based on the type of battery they are producing and targets are based
upon the type and quantity required to be produced on the daily basis.
The incentives are given according to pay scales and ranks and all concerned personnel get
them upon target achievements. It is distributed quarterly.
Medical cards are given to all permanent and contractual employees and first aid is available
in every unit of the plant.

The lead time is 15 days.

**Lead time = time from order taken to order delivery
The processing time is 1 hour and the wait time is 5 minutes
Throughput time = process time + wait time
TPT = 60 + 5 = 65 mins

Productivity Standards
The productivity standards followed are Japanese Standards. They also follow the quality
standard of Pakistan, that is Pakistan Standards.
They also possess the ISO certifications of 9001, 14001, and 18001 for the quality
management system, environmental management system, and health and safety management
systems respectively.

What are they doing for improvement (process/product)?

For the improvement of processes and production, they constantly keep on upgrading their
machinery whenever required. Training drills are also part of the routine to train the labourers
to help reduce human error. Most of the labourers hired are usually professionals with prior
working experience of 2-3 years to help reduce training costs and increase labour efficiency.

Manufacturing Processes
 Curing takes the highest time in alloy blending, it takes around 18-24 hrs.
 Charging vats required 10-12 hours of charging time.
 2% wastage is standard currently in the manufacturing of lead plates, earlier it was
4%.
 Plate breakage usually happens during the cutting process of the plates panel.
 Machinery up-gradation and process up-gradation have helped reduce the wastages.
 Stacking takes most of the time on an assembly line, rest are continuous processes
with no work in process inventory build-up.
The formula used to calculate wastage is:
Wastage = Actual material used – Material required
**Actual material consumed = Opening raw material + Purchased material – Closing raw
material.

Capacity of Plant at Different Levels

There are different levels of capacities at different levels of production, as almost finished or
semi-finished materials required for production are produced in-house. They have different
production capacities of different plants per month. For dry charge batteries, it is 350,000
units. For maintenance-free batteries, 60,000. For motorcycle batteries 350,000. For VRLA &
Tubular batteries, around 17,000.

 The average maximum daily production of lead plates is 900,000 or 0.9 million.
 The production of dry-charge is 9,000 units and maximum capacity is 15,000 units a
day.
 Almost a similar number for motorcycle battery plant, which usually operates at max
capacity due to high demand in the market.
 The moulding injection plant works continuously despite the requirement and demand
and always has an excess inventory for most of the running items.

Assessment of Working Environment

The environment of the production plant is friendly, but there is no compromise on the
efficiency of production as it is their competitive edge. All the departments work in close
coordination so the process is completed flawlessly without wastage of time.
While Sundays are off, the production department is aware of the overtime requirements
depending upon the production plan by the planning department. In case of excess
production, an extra shift is added to the process or even Sunday becomes a working day, and
labourers are paid for extra time. There is a 1-hour break for lunch and prayer, lunch is served
by the factory every day at a cafeteria inside the plant.
The assembly line workers have only 2 shifts while moulding & casting section workers (who
are making battery components) have mostly 2 shifts and if required, 3 shifts depending upon
the orders at hand.
The labour for the production department is mostly outsourced and works on a daily wage of
PKR 700. The workers that are placed at crucial steps like stacking, group welding, the
battery man, are permanent employees. However, the HR, health & safety, accounts, store,
quality check, planning, and production executives are also hired by the company on a
regular and permanent basis. The process is semi-automatic. They are using labour as well as
machines.
Challenges faced by Organization
There are a few challenges faced by the organization that is listed as follows:
 Their work is highly labour-intensive along with machinery and there is always a
chance of human error. For instance, there can be an overuse of production lead,
which may lead to decreased efficiency.
 The company has also failed to fully embrace automation. Coupled with human
error, this can lead to issues in the production process, such as uneven melting of lead
in group welding. Furthermore, if there is a lag in the labor (such as sick leave), it
becomes difficult for the company to achieve its daily targets.
 There is a slight lack of monitoring during production. For example, when a plate
breaks during the stacking phase, it may occasionally go undetected.
 Exchange rate is the major cause of price fluctuations.

Analysis & Recommendations

We have analyzed, all their workforces are men. When inquired about it, they said that our
production processes are very harsh, and our labour has to deal with high-temperature heat
and sulphuric acid, so we don’t like females to work under such harsh conditions.
The overall work environment is good and friendly. Staff is very respectful and even small
rewards are given if someone works exceptionally. A labourer was rewarded by GM Factory
upon cleaning his machine when he finishes up his shift.
They always have a buffer raw material for one month to cope with any unforeseen events.
Their labour is loyal because they always pay them on time. As part of their CSR activity, all
lower staff are given Ramzan Rashan and pay bonuses on Eid.
We recommend that to improve their efficiency, Pakistan Accumulators should add more
machinery in the production as their production process is very labour-intensive and there is
always a chance of error. Not only would their quality improve, but it can also be highly
beneficial, such as better monitoring and detection of errors.
Exhibit 1: Process Flowchart of the Assembly Line
Exhibit 2: Alloy Blending Process