Pak Suzuki extends plant shutdown to January 13

Pak Suzuki Motor Company (PSMC) on Friday notified again that it will extend its plant shutdown from January 9, 2023 to January 13, 2023.

In a notice sent to the Pakistan Stock Exchange (PSX) on Friday, the company said “in accordance with Section 96 & 131 of the Securities Act 2015 and clause 5.6.1 (a) of PSX Regulations and further to our letter dated December 26, 2022 on above subject, kindly note that due to continued shortage of inventory level, the management of the company has decided to extend the shutdown of automobile plant from January 9, 2023 to January 13, 2023.”

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“However, motorcycle plant will remain operative. Further update, if any, in this regard will be communicated accordingly. You may please inform the TRE certificate holders of the Exchange accordingly.”

On December 26, PSMC announced the temporary shutdown of its plant for automobiles and motorcycles from January 2 to 6, citing inventory shortage.

In a notice sent to the PSX, PSMC said the State Bank of Pakistan (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.

“Restrictions had adversely impacted clearance of import consignment which resultantly affected the inventory levels.

“Therefore, due to shortage of inventory level, the management of the company has decided to shut down its plant for automobile as well as motorcycle for period from January 02, 2023 to January 06, 2023,” said PMSC, which is engaged in the assembling, progressive manufacturing and marketing of Suzuki cars, pickups, vans, 4x4s and motorcycles and related spare parts.

Pakistan’s auto industry, highly dependent on imports, has been caught in the midst of a crisis, as the SBP, after unabated rupee depreciation, imposed restrictions on the opening of Letters of Credit (LCs).

Economic experts have attributed the development to very high auto prices, which has crashed demand. They say that until import restrictions are eased and energy shortages are dealt with, the situation would only deteriorate.

Other firms in the automobile sector that shut down operations are Indus Motor Company (INDU) and Baluchistan Wheels Limited (BWHL).

Since December, major textile firms including Nishat Chunian, Kohinoor Spinning Mills Limited, and Suraj Cotton Mills Limited have announced to limit their operations as well.