Shipment delays threaten auto parts supply chain

September 4, 2021: The supply chain of automobile parts is likely to be disrupted owing to delay in shipments coupled with a hike in freight charges over the past two months, said Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) former chairman Mashood Ali Khan. Two factors would act as a hurdle in the way of a smooth supply chain of auto parts manufacturers and they would be forced to pass on the impact to their customers in the form of price hike. “If we cannot control these basic parameters, then shortages are inevitable,” he noted. “Shipping expenses, which are often disregarded for having little influence on inflation, are now becoming the centre of attention for economists.” “The current cost of vehicle parts and the time taken for their delivery have increased,” said Khan. Earlier, it took 25 days for a shipment to arrive in Pakistan from Qingdao Port, China but now it takes almost 60 days. “A 40 feet container used to cost around $2,000, but now it is priced at $11,000,” he said. Arif Habib Limited analyst Arsalan Hanif said that increase in prices of automobile parts would be unavoidable and uncontrollable because of higher freight charges and congestion at ports. (Credits: Express Tribune)