KARACHI: Pak Suzuki Motor Company Limited (PSMC), one of the country’s largest car manufacturers, has extended its plant shutdown till January 13, blaming inventory shortage for the decision.
“Due to continued low inventory levels, the management of the company has decided to extend the shutdown of the automobile plant from January 9, 2023 to January 13, 2023,” PSMC said in an announcement issued to the Pakistan Stock Exchange. (PSX) on Friday.
However, the motorcycle plant will remain operational, he added.
Earlier, the company’s automobile as well as motorcycle plants remained closed from January 02 to January 6.
A PSMC spokesperson said that last week the company was facing a critical time due to import restrictions and there is no information in the future about how much longer this problem will continue.
Detentions, demurrages, and CABOR+3% are really hurting our industry, he said.
Dealerships and vendors are also worried about the drop in sales and production, the spokesman said. He requested the government to hold talks with the industry to resolve the issue immediately.
Pakistan’s import-dependent auto industry is reeling amid import restrictions imposed by the government.
According to the Pakistan Automotive Manufacturers Association (PAMA), passenger car sales fell 39 percent to 55,144 units in the first five months of fiscal 2023, as against 90,303 units sold in the same period last year.
Apart from Suzuki’s Alto, sales of cars, trucks, buses, tractors, jeeps, pickups and three-wheelers, as well as two-wheelers, as well as all other two-wheeler categories saw a decline in November 2022 compared to November 2021.
Several companies have announced production shutdowns in recent months.
Last month, Indus Motor Company (IMC) announced a 10-day plant shutdown, the third time in 2022, over “obstacles in clearance of imports and consignments”.
The central bank has introduced a mechanism for the auto sector to obtain prior approval for import of fully enclosed kits and components for passenger cars, IMC management said.
“[However,] delays in the said approvals for the company and its vendors have created hurdles in clearance of imports and consignments for the company’s raw materials and components,” the IMC said.
Auto parts maker Balochistan Wheels Ltd also announced plant closure last week due to low demand.
Earlier this week, Millat Tractors also closed the factory till further notice citing low demand and cash crunch.
The government moved to curb imports in the face of rapidly dwindling foreign reserves, a depreciating currency, and a widening current account deficit, affecting industries that depend on imports to complete finished goods. do
