Pak Suzuki extends bike plant shutdown for another week

• Company extends plant shutdown till June 16.
• Decision taken due to a shortage of inventory level.
• Raw material shortage has plagued the firm since July.

KARACHI: Pak Suzuki Motor Co Limited on Tuesday announced an extension in its bike plant’s closure for another week, blaming a shortage of inventory level.

The company had earlier announced non-production days at the plant from May 23 to June 10 but now has extended till June 16.

The decision came as a result of a persistent shortage of raw materials, which was communicated in a statement released to the Pakistan Stock Exchange.

“Due to a shortage of inventory level, the management of the company has decided to shut down the motorcycle plant from June 12, 2023, to June 16, 2023. However, the automobile plant will remain operative,” the company secretary of PSMC Abdul Nasir said in the notice.

The recent shutdown follows a previous closure in May, where both the motorcycle and automobile plants were shut down for more than a week.

The ongoing shortage of raw materials has plagued the company since July of the previous year, primarily due to hindrances in the import of essential components, caused by a decline in the country's forex reserves.

Pak Suzuki is not the only automotive manufacturer experiencing such disruptions. Indus Motor Company, which is responsible for producing Toyota cars in Pakistan, as well as Honda Atlas Cars, have also encountered multiple shutdowns in recent months due to the unavailability of crucial raw materials.

The scarcity has even affected automotive parts manufacturers, forcing them to temporarily halt their own production lines.

The impact of the shutdown extends far beyond the companies themselves. The entire automobile sector, along with various other industries, has been grappling with non-productive days due to the disruption in raw material imports caused by delayed letters of credit openings.

This has led to reduced operational capacities and an overall decrease in productivity across multiple sectors of the economy.

The news of Pak Suzuki's latest shutdown has sparked concerns among employees, stakeholders, and the general public alike. The motorcycle plant, a significant division within the company, is a major employer in the country.

The closure is feared to have a considerable impact on both the company's workforce and the overall economy. One analyst said the motorcycle plant shutdown served as a stark reminder of the broader issues facing the automotive industry in Pakistan.

He urged that stakeholders and policymakers must work together to address the root causes of the raw material shortage and implement sustainable solutions to prevent future disruptions.

Originally published in The News