Indus Motor Company (IMC), the manufacturer and assembler of Toyota-brand vehicles in Pakistan, has announced a shutdown of its plant for seven days citing low inventory and shortage of components.
The company shared the development in its notice to the Pakistan Stock Exchange (PSX) on Friday.
“Based on current low level of inventory of manufactured vehicles, and shortage of parts and components for manufacturing of vehicles, due to supply chain challenges, the company has decided to close its production plant from 15th July 2024 to 22nd July 2024 (both days inclusive),” read the notice.
Pakistan’s auto sector has been under pressure with the country’s slowing economic growth, spiking inflation, and high costs of borrowing denting sales of vehicles.
Pak Suzuki, Honda, and Toyota, often attributed as the “Big Three”, reported a cumulative volume of around 88,000 units for financial year 2023-24, which was a 21-year low, according to a JS Research report issued earlier this week.
The significant drop was attributed to suppressed demand due to lower consumer purchasing power, increased influx of used imported cars, and higher car prices resulting from currency depreciation and taxes levied on auto manufacturers.
In financial year 2022-23, the Big Three sold a total of 113,346 units, the report said.
Last month, Ali Asghar Jamali, Chief Executive Officer of Indus Motor Company (IMC), called on the government to take immediate action to curb the influx of imported used cars, which he believes are receiving preferential treatment.
Jamali noted that the local auto industry has invested approximately $2.5 billion, generated around 2.5 million direct and indirect jobs within the country, and contributed about Rs 400 billion to the national exchequer in FY2022 alone.
However, many also argue that the local auto industry has failed to localise production and is dependent on the exchange rate for price stability.
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