Auto companies have advance payment of Rs 189 billion

by magbia Auto

As Pakistan faces an economic crisis, the local automobile industry appears to be in a turbulent period marked by depreciation of the rupee against the US dollar, economic instability, non-issuance of Letter of Credit (LC) by the State Bank of Pakistan (SBP). . ), and political uncertainty, among other things.

With no CKD kits on hand, companies are canceling bookings and halting production to observe non-production days, resulting in further delays in deliveries, while still advertising huge price increases. which will be applicable to new orders after the resumption of production (assembly).

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During the recent Public Accounts Committee (PAC) hearing, the local auto sector was the subject of discussion. During the discussion, the PAC was informed that the customers have paid Rs. 189 billion as advance payments to ten vehicle businesses.

A carmaker also told PAC that the government had asked the assemblers why they were taking so many reservations from customers if they could not deliver the vehicle on time.

Even before the imposition of import restrictions by the State Bank, the delivery times of locally manufactured cars ranged from 3 to 14 months, depending on the model and assembler. However, with such a huge amount piling up in advance bookings, assemblers must simplify their operations and ensure that they have enough supplies to deliver the vehicles to the customers on time. Except for the Big Three, most players have an annual production of less than 25,000 units, which needs to be increased to meet demand.

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