Pak Suzuki Motors shuts down plant amid import hurdles

KARACHI: Pak Suzuki Motor Co Ltd, one of Pakistan’s leading automobile manufacturers, has shut down its production plant due to significant challenges in obtaining completely knocked down (CKD) kits.

The company cited the prolonged delay in securing the necessary approvals for the import of CKD kits, which are essential for vehicle assembly, as the primary reason for the closure.Head of Corporate Affairs at Pak Suzuki Motor Co Ltd Shafiq Ahmed Shaikh expressed deep concerns over the ongoing situation. In a statement to The News, he remarked, “Pak Suzuki Motor Co Ltd closed and shut down its plant due to no approval of CKD, whereas its CKD is lying at the port for the last 45 days. Due to this, Pak Suzuki is not only paying billions of rupees in detention and demurrages, but the government is also losing out on taxes and duties due to the halt in production and sales.”

The extended delays have led to substantial financial strain on the company, as it continues to incur heavy penalties for the prolonged storage of the CKD kits at the port. The inability to clear these essential components has also brought the production lines to a standstill, impacting the company’s ability to meet market demand.

Shafiq Ahmed further informed that the plant will remain closed until the CKD kits are released. The company has urged the government to address the issue urgently to prevent further economic losses. He emphasised that the Pakistan Automotive Manufacturers Association (PAMA), Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM), and the broader automotive industry have consistently requestedthe government to adhere to the Auto Policy 2021-26.

According to industry insiders, the lack of compliance with this policy could deter potential new investors and put existing foreign direct investors, including auto manufacturers, in a precarious position. The shutdown of Pak Suzuki’s plant has also had a cascading effect on the local supply chain. Several local parts manufacturers, who rely on steady orders from auto manufacturers, have already been forced to lay off thousands of workers due to the decline in production. This disruption in the automotive industry comes at a critical time when the sector was looking to recover from the impacts of the pandemic and resume normal operations.This is not the first time Pak Suzuki has faced such challenges. The company has endured several temporary shutdowns in recent years due to similar issues with the import of CKD kits. Other original equipment manufacturers (OEMs) in the country have also experienced comparable difficulties, underscoring the urgent need for a resolution to the ongoing import challenges.As the situation unfolds, the industry eagerly awaits government intervention to alleviate the current challenges and restore normalcy to Pakistan’s automotive sector.