Zimbabwe's largest auto assembler, Willowvale Motor Industries, is on the verge of collapse due to a US$3.4 million debt to its principal supplier, sources said.
It is feared that thousands of workers employed by the company and in related firms could lose their jobs.
Sources said directors asked the government for an urgent loan so that Willowvale could pay its Japanese supplier, Itochu Corporation, which provides Willowvale with Mazda kits.
Company Managing Director Dawson Mareya refused to comment, but sources said Itochu gave the company until March 18 to clear the debt. A similar grace period was extended several months ago.
Zimbabwe's Parliament has taken up the matter and ordered Willowvale executives to remain silent while it probes alleged management deficiencies.
Lawmaker Misheck Kagurabadza, a member of the Parliamentary Committee on State Enterprises and Parastatals, told VOA Studio 7 reporter Gibbs Dube that the committee visited the Willowvale plant on Tuesday and discussed the firm’s problems with the company's directors and workers.
Willowvale is said to be sitting on a vehicle stock worth more than US$5 million which it cannot sell due to the non-payment of the debt, as Itochu Corporation is in control of the stock.