Ghandhara Nissan Limited has released its latest progress report for its Datsun Car project and the capacity enhancement of the existing operations of the company.
According to the report, Ghandhara Nissan has decided to put Datsun Go Car project on hold.
In a notice to the Pakistan Stock Exchange, GNL noted that Ghandhara and Nissan Motor Co. Limited (NML) have spent a lot of time and resources to ensure an optimum level of localization in an efficient and effective manner.
However, as part of NML’s recent business strategy and particularly the management policy change with respect to the Datsun segment, it is critical to note that Indonesia, which is the mother plant for Datsun CKD kits, may not be a sustainable KD source.
‘The company still awaits Nissan’s assurance/confirmation on the continued and smooth supply of Datsun parts, yet it is high time to put the ongoing project activities on-hold before getting a clear roadmap from NML’ added the report.
”Keeping the above situation in view, till Nissan takes a final decision on this project, GNL will have to wait for a final verdict on the viability of the project. On the other hand, cognizant of the incentives of the Brownfield status, the company is also exploring other avenues in parallel with focusing on capacity building of existing operations,” said the company.
It is worth mentioning, that during October 2019, the company was compelled to revisit the project’s sustainability due to the local economic conditions, particularly the automobile market situation. Ghandhara Nissan had mentioned that one cannot afford to go for a project of this magnitude with such a level of uncertainty in the country.
The company was very much concerned that they have a very limited time-frame to complete all the necessary requirements and start commercial production before 30th June 2021 to avail the brownfield incentives for the new entrants.
The government had awarded the ‘Brownfield Investment Status’ for the revival of the company’s existing assembly to produce Datsun cars in Pakistan.