Pak Suzuki, Agriauto announce shutdown as economic woes bite

Feeling the pinch of economic conditions, Pak Suzuki Motor Company (PSMC) and parts-maker Agriauto Industries Limited separately announced plant shutdowns on Friday.

In its notice to the Pakistan Stock Exchange (PSX), PSMC said: “Due to shortage of inventory level, the management of the company has decided to shut-down its motorcycle plant from September 01, 2023 to September 12, 2023.”

Meanwhile, the automobile plant will remain operative.

During the ongoing year, the Japanese automaker has announced shutdowns over a dozen times. Last month, it said it would keep its motorcycle plant shut till August 31.

It made similar announcements in June and May as well, citing a lack of raw material.

Citing drop in sales and high finance costs, the company announced losses to the tune of Rs9.68 billion in the first six months of FY2022-23.

Pakistan’s auto sector have been facing challenges on several fronts, including high energy costs, political instability and an inability to secure letters of credit for imports amid a severe dollar shortage.

In a similar announcement, Agriauto Industries Limited, a manufacturer of auto parts, on Friday also announced to observe a partial shutdown in September.

“Due to reduction in production volumes of our major customers, the company will be observing partial shutdown during the month of September 2023,” it said in a notice to the PSX.

It added that Agriauto Stamping Company Pvt. Limited, its wholly owned subsidiary, will also observe partial shutdown in September 2023, citing similar reasons.

Despite clinching a last minute programme with the International Monetary Fund (IMF) in July, which provided some breathing space, experts have expressed concern that the economic woes will continue until structural issues behind the constant boom-and-bust cycles are addressed.