ISLAMABAD – Continued inventory shortfall has forced leading car and bike manufacturers to extend the shutdown of their production plants in Pakistan.
Honda Atlas Cars Limited (HACL), which is bearing the brunt of the ongoing economic crisis, is facing issues due to the letter of credit (LC) issue. The company has now extended its production shutdown for next fortnight.
It will be around two months for Honda Atlas to remain non-operational as the carmaker shuts down production in the second week of March which continued till end of March. The company now extended the shutdown till April 30.
The company is facing hard times as it failed to sell a single unit of Civic, its frontrunner in Pakistan, while the extension in production shutdown will further hamper sales in the coming months.
In a recent letter to the Stock exchange, Honda said “considering the current economic situation of Pakistan whereby the Government resorted to stringent measures including restricting opening of 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.”
The company is not in a position to continue with its production and ultimately has continued to shut down its plant from April 16, 2023 to April 30, 2023, it further said.
Likewise, Pak Suzuki Motor Company (PSMC) has also extended the bike production shutdown for next two weeks. The production of a two-wheeler was halted between March 20 and 31. Later, the bike maker notified another shutdown from April 4 to 15.
In the latest letter to PSX, the company notified about the shutdown from April 16 to 28.
The company further increased the prices of almost all of its bikes, with the cheapest unit costing Rs. 0.32 million while the top of the line crosses half-million mark.