Due to supply chain interruptions, Honda Atlas Vehicles Pakistan Ltd (HCAR) has decided to temporarily close its manufacturing from March 9 to March 31.
The auto giant Honda stated in a notice to the Pakistan Stock Exchange (PSX) that the supply chain had been disrupted by government restrictions on the import of completely knocked down (CKD) kits and raw materials, as well as the suspension of foreign payments, and that it was unable to continue operations in such a challenging environment.
Honda Letter to PSX on Closure of its Plant
“Considering the current economic situation whereby the government has resorted to stringent measures including restricting the opening of Letters of Credit (LCs) for import of CKD kits, raw materials and halting foreign payments, the company’s supply chain has been severely disrupted by such measures,” the notice stated.
“As a result, the Honda company is not in a position to continue with its production and ultimately has to shut down its plant from March 9, 2023 to March 31, 2023.”
Several automakers have been compelled to shut down altogether or choose a partial shutdown due to the government’s tight requirements to save foreign currency and decreased market demand.
Due to Pakistan’s extremely low foreign exchange reserves, the government is pleading with the International Monetary Fund (IMF) to reactivate the Extended Fund Facility (EFF) and allow the disbursement of a loan tranche worth more than $1 billion.
Pak Suzuki Motor Company just opened for business again after being closed for around one and a half months.
“With respect to the circular sent on January 20, 2023 for closure of bookings for Suzuki motorcycle products, we are now pleased to resume booking of 2W products from tomorrow, ie March 3, 2023 on allocation basis,” the company announced.
According to the most recent data, Pakistan’s auto sales in January 2023 were about 11,500 units, a 37% month-over-month decline led mostly by Pak Suzuki due to the lack of CKD parts.
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