Suzuki Halts Production Again Due to Inventory Woes
Pak Suzuki has announced Plants Shut doum from May 2-9 over an inventory shortage.
In a recent announcement, Pak Suzuki Motor Company Ltd (PSMCL) has said that auto production plants will remain shut from May 2 until 9 due to a shortage of inventory. This news has created a stir in the automobile industry, and many people are wondering about the reason behind the decision.
Earlier this the company shut the production plants of two-wheelers on 20 March, pulled the shout-down date to 15 April, and extended it to 28 0f April. This time Pak Suzuki has decided to keep all plants across Pakistan shut from May 2 until 9 of the same month.
The decision was made due to a shortage of inventory. This means the company has run out of stock and needs time to replenish its supplies. The shortage could be a result of the ongoing economic situation, low dollar reserves, supply chain issues, and restricting the opening of LCs which has affected many automobile companies nationwide.
The shutdown of PSMCL's production plants will affect the company's production schedule, and it is likely that there will be a drop in sales and delivery of orders. According to the Pakistan Automotive Manufacturing Association March sales report, Pak Suzuki has a relative decline in sales on a YoY basis of -58%, from selling 18,189 units in March 2022 to selling 7,528 units in March 2023.
In conclusion, the shutdown of PSMCL's production plants results from restrictions on LCs, and the company's decision is understandable given the circumstances. However, it is important for the government to take measures to minimize the impact of the shutdown and fulfill orders as soon as possible to avoid any further delays. The automobile industry in Pakistan is likely to face risks of permanent closure, and it is important for companies to take proactive measures to address this issue.
