Karachi, August 25, 2023 – In a stark reflection of the challenges plaguing the automotive industry in Pakistan, Pak Suzuki Motor Company Limited announced a colossal loss of Rs 9.67 billion for the first half of 2023.
This substantial loss comes in stark contrast to a profit of Rs 17.24 million reported during the same period the previous year.
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The announcement sent shockwaves through the financial community as it translated to a loss per share of Rs 117.58 for the first half of 2023, compared to a loss per share of 21 paisas in the corresponding period last year.
The board of directors of Pak Suzuki convened on August 25, 2023, to approve the audited condensed interim financial information for the six-month period ending June 30, 2023. The figures reveal a grim picture for the renowned automaker, with plummeting sales being one of the primary factors contributing to the substantial loss.
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During the first half of 2023, the company’s sales tumbled to Rs 43.18 billion, a stark contrast to the Rs 112.62 billion recorded in the same period of the previous year. This drastic reduction in sales has taken a toll on the company’s bottom line.
While gross profit for the first half of 2023 stood at Rs 4.14 billion, it still marked a decline from the Rs 4.21 billion recorded in the same period the previous year. Furthermore, the company reported a loss before taxation of Rs 8.13 billion, a sharp contrast to the profit of Rs 750 million achieved during the same period in the prior year.
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The broader auto industry in Pakistan is grappling with numerous challenges, including high inflation, expensive borrowing costs, and a significant increase in taxation. These factors have collectively contributed to a massive decline in the sales of vehicles across the country.
Moreover, government-imposed restrictions on imports in the previous year have resulted in a shortage of raw materials, further exacerbating the woes of car manufacturers in Pakistan. These constraints have hindered the production of new vehicles, contributing to the industry’s overall struggles.
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The situation faced by Pak Suzuki Motor Company is emblematic of the wider challenges facing Pakistan’s auto industry. Companies in the sector are navigating a complex landscape, marked by financial losses and uncertainty. It remains to be seen how the industry, alongside the government, will address these issues and work towards a path of recovery in the coming months.
