Suzuki Motor Company Loss Rs12.9 billion Past Three Months

Pak Suzuki Motor Company, one of the leading automobile manufacturers in Pakistan, has been facing a tough time recently. The Company has reported a loss of Rs12.9 billion in the first quarter of 2023 on the Pakistan Stock Exchange, Express Tribune reported. The loss came as a result of high inventory, finance issues, and lower sales in the first three months of 2023.

Suzuki's first quarter 2023 revenue stood at Rs21.84 billion, with declining 54% in sales in contrast to Rs47.74 billion revenue in the first quarter of the last year.

The news cited the revenue fall of 64% quarter-on-quarter (QoQ) basis, 74% year-on-year (YoY) basis, and 70% quarter-on-quarter fall in unit sales.

However, the gross margin reached 9.1% for the first quarter of 2023 which is much lower than that of the previous quarter's 9.8%. Counting on, the distribution and marketing costs grew up to 20% YoY basis while falling 18% QoQ to Rs878 million.

The company showed a loss per share (LPS) of likely Rs157 in the first quarter of the current year, compared to an LPS of Rs5.6 in the first quarter of 2022, which shows a massive raft.

The company shows an amount of Rs274 million in tax expense in Q1 of 2023 compared to Rs155 million in 2022. All these figures show a distressing economic and financial crash in the auto manufacturing industry.

The decline in sales and financial impediments can be contributed to several factors including;

• Depreciation of the Pakistani Rupee
• Sluggish inventory Supply
• Rising inflation (31% over the past few months)
• Shortage of foreign exchange reserves

The recent loss of Rs12.9 billion suffered by Pak Suzuki Motor Company highlights the numerous challenges that the company and the Pakistani automobile industry, as a whole, are facing. However, there are still opportunities for growth and success, and companies that can adapt to these challenges will ultimately survive in the market. Pak Suzuki needs to focus on streamlining its operations, improving efficiency, and investing in research and development to remain competitive. Additionally, the government must provide a more conducive environment for businesses to thrive, such as by addressing supply chain issues, reducing taxes and duties, and promoting exports. By working together and addressing these challenges, the automobile industry in Pakistan can emerge stronger and more resilient than ever before.