Honda plant closed till March-end
Honda Atlas Cars Pakistan Limited (HCAR) has decided to temporarily close its plant from March 9 to March 31, due to supply chain disruptions.
The auto giant announced to the Pakistan Stock Exchange (PSE) that it was unable to continue its operation due to the disruption of the supply chain caused by the government’s restrictions on importing completely knocked down (CKD) kits, raw material, and the halt to foreign payments.
The government’s actions had adversely affected the supply chain, and as a result, the company had to halt its operations.
The notice stated that the government’s stringent measures, which include restricting the opening of Letters of Credit (LCs) for importing completely knocked down CKD kits and raw materials and halting foreign payments, have severely disrupted the company’s supply chain, considering the current economic situation.
“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.”
The government’s strict measures to save foreign exchange and reduced market demand have forced several automakers either to completely close down or opt for partial shutdown.
Pakistan’s foreign exchange reserves are currently very low and the government is trying to convince the IMF to revive the Extended Fund Facility (EFF) for the release of over $1 billion in loan.
However, Pak Suzuki Motor Company resumed booking for its two-wheelers after closure for around one and a half month. “With respect to the circular sent on Jan 20, 2023 for closure of bookings for Suzuki motorcycle products, we are now pleased to resume booking of 2W products from tomorrow, i.e., March 3, 2023 on allocation basis,” Suzuki the company announced.
As per latest news, Pakistan’s car sales, including sales of non-Pama members, came in at around 11,500 units in Jan 2023, down 37% month-on-month primarily led by Pak Suzuki due to the unavailability of completely knocked down CKD parts.
Published in The Logical Baat, March 9th, 2023.