Maruti Suzuki slashes 3000 temporary jobs

Around 3,000 temporary employees with Maruti Suzuki India Ltd (MSIL) have their lost jobs due to the ongoing decline in the automobile sector.

MSIL chairman R C Bhargava said contracts of the temporary employees were not renewed while assuring that permanent employees have not been affected. “This is a part of the business, when demand soars, more contract workers are hired and their number is reduced in case of low demand,” he said while speaking to some TV channels, reported PTI.

RC Bhargava was answering to a query on whether the current fall and production cuts have led to job cuts in Maruti. “Around 3,000 temporary workers have lost jobs with Maruti Suzuki,” he added. Reiterating that automobile sector creates job in the economy — from sales, service, insurance, licensing, financing, accessories, drivers, petrol pumps and transportation — he cautioned, “fewer automobiles (sales) will impact jobs on a larger scale.”

The impact is much higher, he added. When asked if the industry has hit the rock bottom in terms of sales in July, he said revival in the sense of positive growth will start from third or fourth quarter of this fiscal, partly because of the lower base effect. “Hopeful to see strong revival in Financial Year 2021. By then transition to BS VI will be over,” he added. Commenting on expectations from the upcoming festival season, he said due to good monsoon, rural sales may pick up.

“If government makes an announcement and takes positive actions it should help improve the situation,” he said, however, it was up to the government to decide on GST rate cut and take the corrective action.

“Personally we would like to see GST benefits linked to greener/cleaner cars…The government gave tax cut on EVs but hybrid should be given duty cut. There should be tax cut on CNG vehicles,” he added.

In the meanwhile, TVS group auto component maker Sundaram-Clayton Ltd (SCL) on Friday said it will be shutting its Padi factory in Tamil Nadu for two days owing to slowdown in the automotive industry, joining two-wheeler major Hero MotoCorp which also announced closure of its plants for four days. SCL, a manufacturer and supplier of aluminium die cast products to domestic and global automotive OEMS, said it has declared August 16 and 17, 2019, as non-working days for its Padi factory. “This is due to business slowdown across sectors,” Sundaram-Clayton Ltd said in a statement.

Two-wheeler maker Hero MotoCorp also said its manufacturing plants have been shut for four days from August 15-18 as part of annual routine and also to adjust production in line with current market demand, according to a PTI report.