IMC (Indus Motor Company), which assembles Toyota vehicles in Pakistan, stated that the country’s automobile industry is facing unexpected external challenges as a result of the rupee’s depreciation and SBP import restrictions (State Bank of Pakistan).
According to Topline Securities, IMC also warned that if the current situation persists, “some players may exit the market.”
Furthermore, IMC is operating at 40-50% of its production capacity due to a lack of CKD parts on hand due to State Bank of Pakistan restrictions, which are not expected to be lifted anytime soon.
Furthermore, the havoc flood, as well as rising inflation and consumer purchasing power, had a negative impact on the entire sector.
However, due to high interest rates and difficult financing situations, automation financing was reduced from 35% to 10%.
IMC order book is full for the next three months at current production levels. If the restrictions are relaxed, orders can be delivered in 4-5 weeks.
Furthermore, floods wreaking havoc, as well as higher inflation and lower consumer purchasing power, will have a negative impact on demand for the entire auto sector in the coming years.
Because of higher interest rates and shorter financing terms, auto financing has dropped from 35% to 10%. Management stated that the localization rate in value terms for the Yaris and Corolla is 66% after subtracting 39% taxes and duties.
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