Pak Suzuki Motor Company Limited (PSMCL) is facing a major setback as it halts production at its Karachi plant indefinitely.
This disruption is caused by delays in the approval of Completely-Knocked Down (CKD) kits, which have been stranded at the port for 45 days.
This is the first plant closure of the year and underscores deeper issues within the automotive industry.
The shutdown has imposed significant financial burdens on PSMCL, which is struggling with billions of rupees in detention and demurrage fees.
Additionally, the government is losing out on taxes and duties due to the halted production and sales, according to Shafiq Ahmed Shaikh, PSMCL’s Corporate Affairs Head.
Industry associations, including the Pakistan Automotive Manufacturers Association (PAMA) and the Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM), are urging the government to adhere to the auto policy for 2021-2026.
They warn that continued delays and disruptions will deter new investors and worsen conditions for existing foreign investors in the auto sector.
The broader auto industry is already facing severe challenges, leading many local parts manufacturers to lay off thousands of workers due to reduced production. High taxes, interest rates, and steep energy tariffs have prompted many industrialists to cut back on factory shifts and reduce staff over the past two and a half years.
Auto expert Mashood Khan supports PSMCL’s position, stating, “The government must take decisive action to resolve these issues swiftly. Industrialists should be consulted, and any irregularities should be corrected within 24 hours to prioritize the industry.”
Khan also notes that the shutdown affects around 140-145 vendors, potentially jeopardizing their ability to pay workers on time. Both workers and factory owners are burdened by high taxes and exorbitant energy costs.