Honda Atlas has announced the shutdown of its plant in Pakistan for a week-long due to supply chain disruptions that have caused mainly by the restrictions imposed by the government on the import of CKD parts. In a notice sent to the Pakistan Stock Exchange (PSX), Honda Atlas notified that it’ll observe non-production days (NPD) from 4th October to 11th October 2022.
Why Honda Atlas Announced Plant Shutdown?
The government has taken to strict measures considering the country’s current economic circumstances, including limiting the import of CKD kits and raw materials, these actions have also interrupted the company’s supply chain.
Since July, Pakistan’s car sector has struggled to meet delivery deadlines because of constraints that make it difficult to import vehicle parts on time. The industry, which is heavily reliant on imports, has also affected by the current exchange rate crisis, as the State Bank of Pakistan put restrictions on the opening of Letters of Credit as a result of the continuing depreciation of the rupee (LCs). Due to non-production days caused by the lack of available parts in July and August, sales of locally manufactured automobiles decreased by 50% year over year. Other big assemblers including Suzuki and Toyota are also experiencing plant shutdowns due to a lack of CKD parts.
Launch Of The New Honda HR-V:
A number of media outlets have recently reported the indefinite postponement of the new HR-V introduction in Pakistan, which Honda Atlas has intended to launch in September. The company still seen marketing the ‘Coming Soon’ teaser on social media. Given the current situation, it would seem quite difficult for the company to introduce a new vehicle in Pakistan, especially given that the estimated time for delivery of existing cars has already exceeded several months. Now the question is that if the crossover is officially launched, will the company be in a position to deliver the booked units in the time given the supply chain issues as well as import restrictions?
