Agriauto Industries announced that it was going for a partial closure of its auto parts manufacturing plant in the current month. The company informed the Pakistan Stock Exchange (PSX) of the closure but did not include any details regarding the days on which it will be observed. The notification reads:
“Due to the reduction in production volumes of our major customers, the company will be observing a partial shutdown during the month of October 2023. Agriauto Stamping Company, the wholly owned subsidiary of the company, will also observe partial shutdown in October 2023 owing to the (same) reason.”
According to Muhammad Abrar Polani of AHL Research, when consumer affordability declined as a result of the challenging economic climate, there was a cascading effect on the demand for autos and auto parts. Furthermore, higher interest rates have also lowered demand for auto finance, resulting in a reduction in auto sales. Previously, the availability of financing at reasonable rates was critical in promoting the auto sector.
Pakistan’s economy continues to suffer setbacks as industrial firms including automobiles as well as textiles are declaring regular shutdowns due to low demand. Furthermore, a huge increase in production costs due to skyrocketing energy tariffs has rendered Pakistan uncompetitive in international markets as far as exports are concerned, according to industry officials.
A computer animation professional with over 23 years of industry experience having served in leading organizations, TV channels & production facilities in Pakistan. An avid car enthusiast and petrolhead with an affection to deliver quality content to help shape opinions. Formerly written for PakWheels as well as major publications including Dawn. Founder of CarSpiritPK.com