Millat Tractors shuts down production
Pakistan's biggest agricultural machinery manufacturer, Millat Tractors Limited, said on Thursday that it would remain closed from January 6 (tomorrow) till further notice, citing reduced demand and cash flow problems.
In a regulatory filing, it stated, "Due to continuing reduced demand for tractors and cash flow constraints, the company will remain closed from Friday January 6, 2023 till further notice." Millat Tractors Limited had earlier announced that it would observe Fridays as non-production days (NPDs) from Dec 16.
A number of auto part vendors have suspended operations in recent months, citing reduced demand and import curbs imposed by the State Bank of Pakistan (SBP) - that were lifted last week - among other issues.
Some textile companies, including Nishat Chunian Limited, Crescent Fibres Ltd and Suraj Textile Mills, have also partially suspended production recently due to demand destruction and market conditions.
Bolan Castings Ltd (BCL), the makers of various auto parts of tractors and commercial vehicles, had announced NPDs from Dec 5-23 due to declining sales. The production activities of Baluchistan Wheels Ltd (BWL), the makers of steel wheel rims for cars, heavy vehicles and farm tractors, also remained suspended from Dec 12-23 due to thin orders from the assemblers, the company said.
BWL Chief Operating Officer Muhammad Irfan Ghani had told Dawn last month that the tractor industry has been facing a huge drop in production from July onwards due to the floods, restrictions on parts imports, delays in sales tax refunds and uncertain exchange rates.
However, Millat Tractors' problems precede the floods. The manufacturer had suspended production in March as well due to a severe liquidity crunch.
It had said at the time that the entire tractor manufacturing industry was facing a severe liquidity crunch as the industry's over Rs8 billion sales tax refunds were stuck with the FBR for the last two years.
Nishat Chunian Limited, one of Pakistan's largest textile companies, informed investors that it was temporarily shutting off some spindles because of market conditions.
In a Pakistan Stock Exchange filing, Nishat Chunian Limited (NCL) stated, "The company has an installed capacity of 219,528 spindles and 2,880 rotors in its spinning division. Company has decided to temporarily close 51,360 spindles after one month due to market conditions."