Indus Motor Company (IMC), the prominent assembler of Toyota vehicles in Pakistan, has once again revealed its decision to suspend production due to raw material and component shortages. The production halt is scheduled from July 21 to August 3, as indicated in the notice submitted to the Pakistan Stock Exchange (PSX) on Thursday.
In the announcement, IMC cited challenges in importing raw materials and obtaining clearance for consignments, primarily caused by difficulties in opening Letters of Credit (LCs) and supply disruptions from certain foreign vendors. This has resulted in a significant disruption in the company’s supply chain, leading to a shortage of raw materials and components from vendors.
Consequently, IMC is facing insufficient inventory levels to sustain production, compelling the company to cease its production activities. The shutdown period will be in effect from July 21, 2023, to August 3, 2023, both days inclusive.
Remarkably, this marks the sixth time this year that Indus Motor Company has announced a production closure, underscoring the ongoing challenges faced by the country’s auto sector, which heavily relies on imports. The sector has been particularly impacted by the government’s measures to curb imports and restrict the issuance of LCs. Moreover, the higher finance costs and significant increases in car prices have also contributed to reduced consumer demand.
The recurring production closures highlight the complexity of the current economic landscape, with the auto industry grappling to navigate supply chain disruptions and meet the demands of the market. As the situation continues to evolve, stakeholders in the sector are closely monitoring developments and seeking viable solutions to ensure the sustainable operations of automotive manufacturing in Pakistan.