March 31, 2023 (MLN): The management of Honda Atlas Cars (Pakistan) Ltd (PSX: HCAR) has decided to extend the plant shutdown till April 15, 2023, owing to the current economic situation of Pakistan whereby the government resorted to stringent measures including restricting the opening of LCs for import of CKD kits, raw materials and halting foreign payments.
Thus, the company's supply chain has also been severely disrupted by such measures.
As a result, the company is not in a position to continue with its production and ultimately has continued to shutdown its plant.
To recall, the company on March 8, 2023, notified the bourse pertaining to shutdown till March 31, 2023.
The extension in shutdown is expected to affect the production of Honda cars in the region and is likely to have an impact on the company's financial performance.
HCAR is one of the leading car manufacturers in Pakistan, and the shutdown of its plant is expected to have a ripple effect on the automotive industry in the region.
The decision to shut down the plant notified the challenges faced by businesses in Pakistan due to the economic situation. The government's measures to restrict the opening of LCs for imports and halt foreign payments have put a strain on businesses that rely on imports, including the automotive industry.
