Indus Motor Company (IMC), the assembler of Toyota vehicles in Pakistan, has once again decided to shut production from May 2 to May 3, citing raw material and component shortages.
The automaker shared the development in a notice to the Pakistan Stock Exchange (PSX) on Friday.
It said the company and its vendors continue to face hurdles on import of raw materials and receiving clearance of their consignments from commercial banks, on account of difficulties in opening of Letters of Credit (LCs) for raw materials by banks.
“This has disrupted the supply chain of the company and its vendors are unable to supply raw materials and components to the company. Accordingly, the company has insufficient inventory levels to maintain production, therefore the company is unable to continue its production activities.
“In view of the above, the company has decided to completely shut down its production plant from 2nd May 2023 to 3rd May 2023 (both days inclusive),” it added.
This is Indus Motor’s third announcement of production closure this year. Earlier, the company announced a complete shutdown of its plant from February 1 to February 14, and then again from March 24 to March 27 citing inventory shortage.
Days ago, IMC reported a profit-after-tax (PAT) of Rs3.216 billion for the third quarter of financial year 2022-23, a decrease of 37% as compared with earnings of Rs5.118 billion in the same period of the previous year.
On a quarterly basis, the PAT of Indus Motor was up by 142%.
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 Letters of Credit (LC). Additionally, higher finance cost and massive increase in car prices have also reduced demand from consumers.
Pakistan’s auto industry reported car sales of 9,211 units in March, 62% higher on a month-on-month basis but still 66% lower compared to the number in March 2022, according to data shared by Pakistan Automotive Manufacturers Association (PAMA).
Last week, Pak Suzuki Motor Company Limited (PSMC) recorded its highest-ever quarterly loss of Rs12.9 billion in the first three months of 2023 owing to decrease in sales and high finance cost.