Monitoring Desk
ISLAMABAD: Pak Suzuki Motor Company (PSMC) announced a temporary shutdown of its automotive and motorbike production from January 2 to 6, citing an inventory deficit.
The State Bank of Pakistan (SBP) has instituted a mechanism for prior approval for imports under the HS code 8703 category (including CKDs), according to a notice PSMC sent to the Pakistan Stock Exchange (PSX) on May 20, 2022.
Businesses in Pakistan struggle to maintain operations due to severe economic challenges. “Restrictions had a negative impact on the import consignment’s clearance, which in turn impacted inventory levels.
PMSC, which is involved in the assembling, progressive manufacturing, and marketing of Suzuki cars, pickups, vans, 4x4s, and motorcycles, as well as related spare parts, announced that its plant for automobiles as well as motorcycles will be shut down for the period from January 02 to January 06, 2023, due to a shortage of inventory.
Pak Suzuki Manufacturing Business
Due to the SBP’s restrictions on the opening of Letters of Credit in response to the unabated depreciation of the rupee, Pakistan’s auto industry, which is heavily dependent on imports, is currently experiencing an exchange rate crisis (LCs).
Economic experts have attributed the development to the collapse in demand caused by extremely high auto prices. They claim that the situation will only worsen unless import restrictions are loosened, and energy shortages are addressed.
Before this, Baluchistan Wheels Limited (BWHL) management temporarily halted production due to weak market demand for automobiles. The Pakistani automaker Indus Motor Company (IMC), which assembles Toyota vehicles, also declared earlier this month that it would shut down its production facility entirely from December 20 to December 30 due to ongoing issues with import authorization delays.
According to IMC officials in a corporate briefing session last month, the central bank’s import restrictions and the ongoing rupee depreciation are hurting the nation’s auto industry.
At the time, officials stated that the industry struggled with rising production costs due to the rupee’s depreciation. At the same time, demand has decreased due to the recession’s impact on the economy, high-interest rates, and increased duties and taxes on vehicles.
