Tag: plant shutdown

  • Honda Atlas extends production suspension amid an ongoing parts shortage

    Honda Atlas extends production suspension amid an ongoing parts shortage

    Honda Atlas Cars (Pakistan) Limited, a subsidiary of Honda Motor Co., Ltd. of Japan, has officially announced a temporary plant shutdown due to supply chain disruptions.

    In line with their communication dated October 30, 2023, the company has made the decision to extend the plant closure from November 8, 2023, to November 9, 2023, as disclosed in their notice to the Pakistan Stock Exchange (PSX).

    The automaker further said that any updates to this plan will be duly communicated.

    The automaker had previously communicated the shutdown of its plant from October 24, 2023, to October 31, 2023, and later extended it to November 7, 2023.

    This decision was attributed to significant inventory levels and disruptions in the supply chain, which have severely affected the company’s production capabilities.

    Earlier this year, Honda Atlas Cars also suspended its production activities from March 9 to May 15, citing adverse economic conditions in the country and government-imposed restrictions on Letters of Credit (LC) issuance.

  • Pak Suzuki’s auto and motorcycle plant to stay closed till July 19

    Pak Suzuki’s auto and motorcycle plant to stay closed till July 19

    Pak Suzuki Motor Company Ltd (PSMCL), Pakistan’s leading car manufacturer in terms of production and sales, has announced an extension of its plant shutdown due to an ongoing shortage of inventory. The decision was conveyed to the Pakistan Stock Exchange (PSX) through an official notice on Friday.

    In the notice, the automaker explained that the management had decided to prolong the closure of its motorcycle and automobile plant until July 19, 2023, citing the persistent inventory shortage. Previously, PSMCL had already suspended operations until July 15, 2023, and had also experienced a shutdown from May 2 to May 9 due to a scarcity of raw materials.

    It is important to note that the auto industry in Pakistan is facing multiple challenges, leading several automakers to announce temporary or partial closures in recent months, citing various reasons.

    In April, Pak Suzuki reported its highest quarterly loss to date, amounting to Rs12.9 billion in the first quarter of 2023. This decline in profitability was attributed to a decrease in sales and substantial finance costs. In comparison, the company had incurred a loss of Rs460.227 million during the same period the previous year.

    Earlier, Pak Suzuki had appealed to Prime Minister Shehbaz Sharif not to introduce additional duties and taxes in the upcoming 2023-24 budget. The company emphasised the economic uncertainties it was facing and the resulting struggles and losses.

  • Pak Suzuki announces second plant closure in less than 10 days due to parts shortage

    Pak Suzuki announces second plant closure in less than 10 days due to parts shortage

    Due to a persistent lack of imported components and accessories, Pak Suzuki Motor Company Ltd (PSMCL) has prolonged the factory shutdown from January 9 to 13 after keeping manufacturing operations paused from January 2 to 6.

    However, the business stated in a stock filing on Friday that the motorbike facility will continue to be in operation.

    The State Bank of Pakistan’s restrictions on obtaining prior approval for imports, including completely knocked-down (CKD) kits, have prevented PSMCL from opening its production facilities for 30 days since August 2022. This has negatively impacted the clearance of shipments from the port and resulted in shortages of parts and accessories.

    On the fate of employees because of persistent plant closure and plummeting sales of vehicles, a PSMCL official claimed that “so far no company’s employees have been terminated.”

    In 5MFY23, Pak Suzuki’s sales decreased by 35 per cent to 37,042 units from 57,200 in the same time the previous fiscal year.

    On Friday, the Lahore Chamber of Commerce and Industry (LCCI) and the Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) both voiced their concerns regarding Millat Tractors’ decision to cease operations for an indefinite period of time due to declining sales and delayed sales tax refunds.

    In a joint statement, PAAPAM Senior Vice Chairman Usman Aslam Malik and LCCI President Kashif Anwar observed that “we should save Pakistan first, then politics, before we reach the point of no return.”

    Both leaders urged the administration and the opposition parties to get together and talk about how to resolve the nation’s crisis.

    They pointed out localization as the long-term answer to economic issues. The removal of imports must be given first priority, followed by the removal of export.