Honda Atlas extends plant shutdown till May 15

Honda Atlas Cars Pakistan on Friday announced the extension of its plant shutdown till May 15, 2023.

In a notice to the Pakistan Stock Exchange (PSX), the company wrote “further to our letter dated April 13, 2023, and considering the current economic situation of Pakistan whereby the government resorted to stringent measures including restricting opening of LCs for import of CKD kits, raw materials and halting foreign payments, the company’s supply chain has also been severely disrupted by such measures”.

“As a result, the company is not in a position to continue with its production and ultimately has continued to shut down its plant from May 1, 2023 to May 15, 2023.”

The firm has been observing a plant shutdown since March 9, 2023.

It planned to restart production on April 1 but extended the shutdown till April 15 initially and then till April 30.

According to latest data released by Pakistan Automotive Manufacturers Association (PAMA), Honda Atlas reported month-on-month and year-on-year decline in sales by 49% and 77%, respectively, as it sold just 835 units in March 2023.

Pakistan’s auto sector remains engulfed in various crises, with a number of automakers announcing complete or partial shutdowns in recent months citing various reasons including reduced demand in the market and the company’s inability to maintain inventory as they struggle to secure LCs.

The country remains short of much-needed dollars to meet its import needs and other external payment commitments. Foreign exchange reserves held by the State Bank of Pakistan (SBP) increased $30 million, clocking in at $4.46 billion as of April 21, data released on Thursday showed.

Meanwhile, the government remains engaged in trying to convince the International Monetary Fund (IMF) to revive the stalled Extended Fund Facility (EFF) programme, which if approved by its board would release a funding tranche of over $1 billion.