Karachi: The Suzuki Motor Company Ltd (PSMC) has decided to keep its car and bike plants in Pakistan closed from June 22 to July 8 due to import restrictions and its impact on parts and accessories, according to a media report on Tuesday.
The move by the Japanese auto major comes merely a week after it started operations at its four-wheeler unit in Pakistan that was shut for over 75 days, it said. The firm in a statement to the Pakistan Stock Exchange on Monday said it was suspending production due to a shortage of parts and accessories because of a mechanism introduced in May last year by Pakistan’s central bank, the Dawn News reported.
The State Bank of Pakistan in May last year asked companies to take prior approval for the import of completely knocked-down kits, which had adversely affected the clearance of consignments, thus affecting inventory levels. The ongoing shortage of raw materials has plagued the company for a year as the PSMC kept its four-wheeler plant shut for over 75 days from August 2022 till June 19, the Express Tribune newspaper reported.
“Due to shortage of inventory level, the management of the company has decided to shut down motorcycle and automobile plants from June 22 to July 8, 2023,” the company said.
The company had also kept its bike plant closed from May 23 to June 16, the report said. Other companies such as Indus Motor Company have also announced multiple shutdowns following import restrictions.
Auto is one of the sectors affected by current economic conditions in Pakistan as the importers have been struggling to get their letters of credit (LCs) issued amid the low foreign exchange reserves of cash-strapped Pakistan. Car sales have drastically dropped in Pakistan amidst an economic downturn and a decline in purchasing power due to record inflation. In May 2023, car sales plunged by 80 per cent year-on-year, according to Pakistan Automotive Manufacturers Association.