PSMC (Pak Suzuki Motor Company Limited) has recently announced further production shutdowns for another three days. According to the report, the company management decided to shut down the automobile plant from October 24 till October 26.
Details of Production Shutdown of Pak Suzuki Plant:
In a notice sent to the Pakistan Stock Exchange, Pak Suzuki stated that it cannot continue production due to import restrictions imposed by the State Bank of Pakistan. This is not the first time the company has announced the closure of its assembly plant, Pak Suzuki shut down its plant production for the eighth time in September and October 2022 combined.
According to the detail of the last two-month company stop its production line from August 18 to August 19, then from August 22 to August 26, and then from August 29 to August 31. After that, it halted production from September 6 to September 9, then from September 19 to September 23 as well as 19th to 21st October 2022.
What Causes It to Occur?
The local automaker has blamed the State Bank of Pakistan (SBP) import limit as the sticking point in the current manufacturing crisis. Suzuki and other automakers need letters of credit to import auto parts, but the central bank is not approving them. Locally assembled automobiles has produced utilizing imported full knockdown kits (CKDs), which are essential automotive parts assembled in Pakistan. While some parts have produced locally, it is necessary for manufacturing like the engine and electronics in order to make and market cars. State Bank has limited these imports, due to the shortage of supplies the companies have forced to halt production.
According to The Company Statement:
Restrictions imposed by the State Bank of Pakistan had a negative influence on the import consignment’s clearance, which in turn had a bad impact on inventory levels. Therefore, due to low inventory levels, the management of the company has decided to shut down its production plant from 24 October 2022 to 26 October 2022.
