Pak Suzuki Motor Company (PSMC) on Thursday said it has further extended the shutdown of its automobile production plant from August 22 to 26, citing import restrictions by the State Bank of Pakistan (SBP) that have "adversely impacted clearance of import consignments, which resulted in affecting its inventory levels".
In a notice sent to the Pakistan Stock Exchange (PSX), PSMC said that the SBP has introduced a mechanism for prior approval for import under HS code 8703 category (including CKDs) vide circular No.09 of 2022 dated May 20, 2022.
“(These) restrictions had adversely impacted clearance of import consignment which resultantly affected the inventory levels,” said PSMC.
As a result, PSMC said it is facing a shortage of inventory level, thus the management of the company has decided to further extend the shutdown period of the automobile plant from August 22, 2022, to August 26, 2022.
Pak Suzuki warns of plant shutdown in August if import restrictions persist
Earlier this week, PSMC had notified the PSX that it will be suspending its automobile production from 18th-19th August 2022 on account of depleted inventory levels.
However, motorcycle plant will remain operative, PSMC said on both occasions.
Pakistan's auto industry, highly dependent on imports, has been caught in the midst of an exchange-rate crisis, as the SBP, after the unabated rupee devaluation, imposed restrictions on the opening of LCs.
Speaking at a summit in Islamabad on Wednesday, Finance Minister Miftah Ismail admitted that some industries would bear some pain due to import curbs.
Interestingly, the notices by Pak Suzuki come after it decreased the prices of its cars in the range of Rs75,000-199,000 owing to the sharp recovery in the rupee's value against the US dollar. It had earlier in August massively increased prices due to rupee depreciation.
The firm slashed the prices of its vehicles after Indus Motor Company (IMC) made a similar move a day ago. Late on Monday, IMC decreased the prices of its cars by Rs260,000-1,140,000.
Honda Atlas also announced decreasing its car prices on Wednesday.