of Pakistan as the domino effect of dollarization-- spiralling inflation, rising freight rates, escalating utility tariffs, mounting bank interest, skyrocketing material cost, and crunch of working capital--has turned the SMEs of the country’s automotive parts sector into bankrupt.
There was a sordid discussion on the current economic situation, especially the freezing of major cost elements by OEMs, which has become a burning issue for all the vendors. The Members’ fears were tabled by both small and large vendors, and it revolved around a single-point agenda as to how the vending industry can survive in the current circumstances because the entire auto parts sector is in gridlock.
They unanimously sought urgent support from the automotive manufacturers , who have been supplied high-quality parts by all the PAAPAM members, at reasonable prices for the last many decades. As a result, the OEMs’ assembly lines may shut down and the worst-case scenario could be that OEMs may have to import auto parts at exorbitant costs on account of heavy freight and high duties.