Honda Atlas Cars Ltd (HACL) has announced its plans to resume production following a slight improvement in the accessibility of trade finance facilities for the automotive supply chain. The company aims to gradually increase production, although an exact date for the resumption was not provided in the stock filing.
An official from HACL stated that while the specific resumption date is yet to be confirmed, it is anticipated that production activities will recommence by the end of this month.
HACL’s local assembly of Honda vehicles had been suspended since March 9 due to restrictions on opening letters of credit for the import of completely knocked kits. This interruption resulted in a significant decline in production, with 545 units of Honda Civic/City and 30 units of Honda BR-V assembled in March. However, there was no production reported in April.
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The company’s sales during the first ten months of the fiscal year 2022-2023 witnessed a sharp decline of 49% compared to the same period in the previous fiscal year. Sales figures plummeted from 32,639 units to 16,485 units, reflecting the adverse impact of the production suspension.
The decision to resume production is expected to alleviate some of the challenges faced by HACL in meeting customer demand. By regaining momentum in production, the company aims to gradually recover and stabilize its sales performance in the coming months.
HACL remains committed to delivering high-quality Honda vehicles to its customers while navigating the evolving trade finance landscape. The resumption of production signifies a positive development for the company and the automotive industry as a whole, providing a glimmer of hope for a rebound in sales and economic recovery.
As the trade finance accessibility improves, HACL is optimistic about its ability to gradually ramp up production, meet market demands, and contribute to the overall growth and development of the automotive sector.