The automotive industry is struggling due to relentless economic troubles. In a recent unfortunate development, Honda has decided to shut down vehicle production for over 20 days.
The official notification cites disruption in the supply chain due to the economic deterioration and restrictions on raw materials and CKD imports as the reasons for the lengthy shutdown.
The details are as follows:
Since July 2022, the auto industry has been facing production cuts and delivery delays due to import restrictions. Some automakers also offered customers to cancel their bookings and receive full refunds with a markup.
Due to its heavy reliance on imports, the auto industry is also feeling the effects of the Rupee devaluation. The State Bank of Pakistan’s (SBP) restrictions on the Letters of Credit (LC) is causing import delays and inventory rate hikes.
Hopefully, the current production shutdown doesn’t end with another price hike announcement.
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