Pakistan’s Automobile maker Honda Atlas Cars (Pakistan) Limited (HCAR) has temporarily shut down its production plant from 9th to 31st March 2023, citing supply chain disruptions.
The company announced its decision in a notice to the Pakistan Stock Exchange (PSX) and the current economic situation. The Auto industry barely survives in the country as Economical crisis worsens in Pakistan.
“Considering the current economic situation of Pakistan whereby the Government 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 also been severely disrupted by such measures,” read the notice.
“As a result, the company is not in a position to continue with its production and ultimately has to shut down its plant from March 09, 2023, to March 31, 2023,” Atlas Honda added.
Earlier day Ghandhara Nissan Limited (GNL) Assembler of Chery Tiggo 4 Pro and Tiggo 8 Pro in Pakistan suspended vehicle production for 7 days testifying to the dire state of the industry.
From 6th March 2023 to 10th March 2023, the company will observe non-production days (NPDs). The company will resume operations on Monday 13 March 2023 after the upcoming weekend. It cites import restrictions on completely knocked-down (CKD) kits as the reason for the NPDs.
According to Company Offoicals, the Production has been halted for further orders due to a shortage of Inventory.
Remember that Rupee has fallen, inflation has reached high levels for decades and Pakistan’s economy has collapsed alongside a political crisis. However, devastating floods and a global energy crisis have added additional stress and harmed the country’s economy.
A shortage of imported parts and materials forces automotive and other industries to shut down their operations. Due to a shortage of foreign reserves, thousands of containers containing essential food items, raw materials, and medical supplies have been held up at the Karachi port.
Banks are refusing to issue new letters of credit to importers because they don’t have enough dollars