Honda Atlas Cars Pakistan, a subsidiary of Honda Motor Co., Ltd., Japan, on Wednesday announced a temporary shutdown of its plant, citing supply chain disruptions.
“The current level of inventory and parts shortages of the company’s supply chain has been severely disrupted,” said Honda Atlas Cars in a notice to the Pakistan Stock Exchange (PSX).
“As a result, the company is not in a position to continue with its production and, resultantly, will shut down its plant from October 24, 2023 to October 31, 2023,” it added.
Earlier this year, the automaker shut its production activity from March 09 to May 15, citing deteriorating economic situation in the country and government restrictions over the issuance of Letters of Credit (LCs).
As per Honda’s latest financial results, the company’s profit-after-tax stood at Rs144.96 million in 1QFY24, a decline of nearly 78%, as compared to Rs658.2 million recorded in same period last year.
Auto sector woes
The country’s auto sector, hugely dependent on imports, has been hit hard by the government’s decision to curb imports and restrict issuance of LCs. Additionally, higher finance cost and massive increase in car prices have also reduced demand from consumers.
In the first quarter of FY24, sales stood at 20,983 units, down 40% as compared to the the same period in the previous year.
On Wednesday, Pak Suzuki Motor Company (PSMC) announced a temporary shutdown of its automobile plant.
“Due to shortage of inventory level, the management of the company has decided to shut-down its automobile plant from October 25, 2023 to October 27, 2023,” PSMC said in its notice.
Meanwhile, the motorcycle plant will remain operative, it added.
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