Monday, June 17, 2024

Indus Motor to ShutDown its Plant Completely for Two Weeks

Indus Motor Company Limited (INDU), Pakistan’s assembler and seller of Toyota-brand vehicles, announced a complete shutdown of its plant from February 1 to February 14, citing an inventory shortage.

When the company restarts production on February 15, it will do so on a single-shift basis until further notice, according to a communication issued to the Pakistan Stock Exchange (PSX) on Tuesday.

Indus Motor said the company and its vendors continue to face major hurdles in the import of raw materials and receiving clearance of their consignments from commercial banks.

The Toyota manufacturer mentioned that these laggards have disrupted the entire supply chain and that the vendors are unable to supply raw materials and components to the company.

Following a major loss of the Pakistani rupee against the US dollar a few days ago, Indus Motor raised the prices of their cars by as much as Rs 1.16 million for the second time in two weeks.

“In light of the recently introduced mechanism, vide EPD Circular No. 20 of 2022, dated December 27, 2022 (effective from January 2, 2023), commercial banks are advised to prioritise and facilitate imports to specified sectors only, which does not include the auto sector,” read the notice.

“This has disrupted the entire supply chain, and the vendors are unable to supply raw materials and components to the company.” “Accordingly, the company has insufficient inventory levels; therefore, the company is unable to continue its production activities,” it added.

With effect from January 2, 2023, the central bank decided to remove the import restrictions that had been in place.

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