Client Name

Master Changan Motors Limited

Faculty Advisor

Dr. Raja Shahzad Shaikh

SBS Thought Leadership Areas

Behavioural Studies

SBS Thought Leadership Area Justification

Our project aligns directly with the Behavioral Studies thought leadership area because it evaluates a major technology transition—the shift from Internal Combustion Engines (ICE) to New Energy Vehicles (NEVs)—not merely as a technical or financial event, but as a deeply social and psychological process. The research moves beyond basic market tracking to examine how consumer risk perceptions, social networks, and cultural biases influence economic choices.

The alignment is demonstrated through three core behavioral frameworks:

1. Inversion of the Innovation Adoption Lifecycle Standard adoption theories state that younger, tech-literate consumers naturally lead the transition to advanced technologies. Our empirical findings reveal a complete demographic inversion unique to the local market:

The Behavioral Pattern: Survey data demonstrates that respondents under the age of 25 exhibit the highest psychological attachment to legacy Japanese market dominance (82.0%).

The Psychological Driver: Qualitative interviews show that younger buyers face high financial exposure early in their careers and cannot afford to risk capital on unproven secondary markets. As a software engineer (T.S., age 27) noted, the risk of initial depreciation acts as a hard behavioral veto.

The Disruption Leaders: Openness to market disruption peaks among the 45 and older cohorts. Capital-capable early adopters—such as K.W. (66) and K.A. (52)—possess the deep financial security required to look past asset-value uncertainty in exchange for immediate utility, high fuel savings, and home solar grid integration.

2. Quantifying the Psychological Premium of a Brand Badge Using Brand Trust Theory, the study analyzes how social influence and risk avoidance override objective product specifications, forcing a measurable financial loyalty tax on buyers: 

The Badge Experiment: In a controlled test comparing two vehicles with completely identical physical options, engine specifications, and pricing—differing only by their brand badges—71.5% of the market rejected the Chinese badge in favor of the Japanese nameplate.

The Loyalty Premium: This psychological bias scales directly with household purchasing power. Among high-income earners (above PKR 1 Million monthly), 83% state they would pay an extra cash premium just to secure a Japanese badge over an identical Chinese vehicle.

The Underlying Value Asset: Participant B.Z. articulated this consumer psychology directly: "In Pakistan, we don't treat a car as a liability; we treat it as an asset." Resale value is utilized as a vital psychological risk-management tool to protect family wealth against macroeconomic shocks, inflation, and currency devaluation.

3. Human Behavior and Environmental Adaptability The project explores how consumers actively modify their daily habits, information gathering, and driving patterns to survive localized infrastructure constraints and economic distress:

Macroeconomic Coping Triggers: Sudden fuel shocks and inflation have turned energy efficiency into an urgent survival strategy. This intense financial anxiety forces literal changes in human behavior; traditional vehicle owners like M.M. describe a state of strict cost calculation for everyday tasks, noting that their "heart sinks when the RPM increases." This distress cracks traditional brand loyalties and forces consumer openness to alternative platforms.

Post-Purchase Behavioral Adjustments: Focus groups captured the complex behavioral changes required to operate an advanced EV within an under-developed charging ecosystem. Early adopter S.A. detailed how EV ownership forces drivers to learn specialized battery management habits—such as keeping the state of charge strictly between 20% and 80%, avoiding fast commercial chargers, and timing charging sessions at night to protect the asset from peak daytime heat.

Social Proof over Corporate Marketing: Because of deep market information asymmetry, contemporary car buyers bypass official corporate showrooms and rely on digital peer networks. Our data highlights that social media (29.8%) and PakWheels (21.7%) dominate consumer research, proving that buyers rely on online communities (such as the 100k+ member online group utilized by M.A.) to gain real-world social validation before committing capital.

Aligned SDGs

GOAL 7: Affordable and Clean Energy

Aligned SDGs Justification

The project aligns directly with the United Nations Sustainable Development Goals (SDGs) by connecting corporate automotive strategy with broader global sustainability targets. This alignment is demonstrated through three specific goals:

1. SDG 7: Affordable and Clean Energy

Core Focus: Accelerating the transition to zero-emission energy and vehicles.

Project Example: The study evaluates how local consumers use private household solar panels and net-metering connections to charge their New Energy Vehicles (NEVs) completely for free. This effectively shifts their daily transportation footprint entirely off the public fossil-fuel grid.

Policy Analysis: The research tracks how changes in national solar export regulations directly alter a consumer's willingness to adopt plug-in or full electric vehicle platforms.

2. SDG 9: Industry, Innovation, and Infrastructure

Core Focus: Making industries sustainable through cleaner technologies and infrastructure adaptability.

Project Example: The study identifies and tracks the exact macro-environmental constraints holding back EV adoption, including public charging network gaps (37.0%) and national electricity load-shedding crises (11.6%).

Assembly Optimization: By evaluating consumer interest levels across distinct powertrain setups—Battery Electric Vehicles (BEVs), Plug-in Hybrids (PHEVs), and Range-Extended Electric Vehicles (REEVs)—the research helps the corporate client optimize local complete knocked-down (CKD) manufacturing strategies for the local ecosystem.

3. SDG 13: Climate Action

Core Focus: Improving local capacity and awareness regarding climate change mitigation.

Project Example: The thesis explores how severe macroeconomic fuel shocks act as behavioral triggers, forcing conservative, risk-averse buyers to look past old brand biases and shift their purchasing intent from high-emission ICE vehicles toward green platforms.

Knowledge Diffusion: The study maps how online peer networks and digital owner communities actively spread practical technical knowledge regarding energy efficiency and battery health, lowering the entry barriers for sustainable mobility.

NDA

No

Abstract

The introduction of Chinese New Energy Vehicles (NEVs) is a paradigm shift in the automotive industry of Pakistan as it is threatening the long-established monopoly of the traditional Japanese automakers. This Experiential Learning Project was carried out in collaboration with Master Changan Motors Limited (MCML) and talks about the psychological and structural obstacles to the mass-market adoption of these advanced platforms. The main aims of the research are to conduct a systematic assessment of the perceptions of the population towards the brand, to map the behavioral determinants of vehicle purchases, to measure the lack of consumer trust, and to determine the general willingness of the market to buy electric and hybrid cars under extreme macroeconomic pressures. The mixed-methods approach helped the research team to obtain a clear image of the local landscape. A conditionally routed digital survey was used in the quantitative stage to extract specific data comprising over 200 specific vehicle owners – this ensured a high-resolution cross-segment accuracy. This framework was also based on qualitative field research, which included twenty one-on-one interviews and a structured focus group, which included early NEV adopters, traditional vehicle loyalists, and market experts. The study provides an overall strategic change for the corporate client as per the intelligence collected. The implications are that to compete solely on the basis of advanced digital features is not enough in a market that is highly defensive of its capital. The study therefore gives practical suggestions to devise effective financial safety nets particularly the contractually assured residual value buyback plans to vigorously respond to the panic in the secondary market. In addition, the report suggests the implementation of Range- Extended Electric Vehicles (REEVs) as a solution to overcoming the absence of public charging in the country, and re-targeting core promotion to non-youth-risk averse and corporate-rich corporate fleets.

Document Type

Restricted Access

Document Name for Citation

Experiential Learning Project

Notes

The report contains a drive link (in the appendix) .

All the supporting documents including PowerBI Dashboard (.pbix) and PPT along with transcripts for all interviews are available in the drive link:

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