- In a separate notice, Millat Tractors also says it will keep its production operations closed from Wednesday, August 31, 2022, till September 16, 2022
Indus Motor Company (IMC), the assembler of Toyota-brand vehicles in Pakistan, on Tuesday announced it will temporarily shut down its production plant from September 1, 2022, to September 16, 2022.
The development comes a month after IMC earlier shut its production plant from August 1, 2022, to August 13, 2022.
In its notice sent to the Pakistan Stock Exchange (PSX), IMC said it faces insufficient inventory levels required to maintain further production.
“State Bank of Pakistan (SBP) has introduced a mechanism, vide EPD Circular No. 09 of 2022 dated May 20, 2022, for obtaining prior approval for import of CKD kits and components of Passenger cars (HS Code 8703 category) for the auto sector.
“The delay in aforesaid approvals has created hurdles in the clearance of import consignments of the Company, resulting in a significant reduction in inventory levels and consequently, creating an adverse impact on the supply chain and production activities,” read the notice.
It added that the situation is forcing the company towards a temporary production shutdown and closure of its plant.
“Due to insufficient inventory levels to maintain production, the company has decided to temporarily halt its production activities.
“In the light of the above, the Company has decided to temporarily shut down its production plant from September 1 to September 16, 2022. However, in case of any change in production plan due to approvals being sought, the same will be communicated accordingly,” it added.
In a separate notice, Millat Tractors also announced that it will keep its production operations closed from Wednesday, August 31, 2022, till September 16, 2022, citing inventory situation. The company said that tractor deliveries have been affected due to damaged road infrastructure in view of devastating floods all over Pakistan.
Pakistan’s auto industry is struggling to meet its scheduled delivery periods as restrictions have hindered the timely import of auto parts, prompting one assembler to offer refunds to its customers as well. The sector, highly dependent on imports, has also been caught in the midst of an exchange-rate crisis, as the SBP, after the unabated rupee devaluation, imposed restrictions on the opening of Letters of Credit (LCs).
On Monday, Pak Suzuki Motor Company (PSMC) announced it extended the shutdown of its automobile production plant from August 29 to 31, citing import restrictions by the SBP that have "adversely impacted clearance of import consignments, which resultantly affected the inventory levels".