Coronavirus impact: Maruti to M&M, automakers put brakes on production

BSIV vehicles purchased until March '20 to be operational for the entire period of registration
Some of the country’s top automakers have taken the lead in suspending production to safeguard its employees as COVID-19 continues to spread despite lockdowns.

Maruti Suzuki India (MSI), the country’s largest carmaker, said it was suspending production at its facilities in Haryana “till further notice”. The company’s research and development centre at Rohtak would also remain closed, it said. “As a next step, the government policy now requires closure of production and, accordingly, the company has taken a decision on production closure,” the firm said.  

Mahindra & Mahindra (M&M) said it had suspended manufacturing at its Nagpur plant and would halt production at Chakan (Pune) and Kandivali (Mumbai) from Monday. Anand Mahindra, group company chairman, said on Twitter the company would immediately begin work on how it can make ventilators at its plants. 

“A lockdown over the next few weeks will help flatten the curve and moderate the peak pressure on medical care,” Mahindra said, adding that it would offer its holiday resorts as temporary care facilities and help the government in building such centres.

Mercedes-Benz and Fiat have also suspended operations till the end of this month. Volkswagen is shutting Pune plant for three weeks. After advising staff — except in business-critical roles — to work remotely, Ford India has decided to suspend vehicle and engine production at its manufacturing sites in Chennai and Sanand from March 23 till March 28.

Hero MotoCorp, the country’s largest two-wheeler maker, said it had suspended production at all sites globally till March 31. “The firm has decided to halt global operations — including at India, Colombia and Bangladesh — and the global parts centre at Neemrana till March 31,” it said. Employees at all the other locations, including the Centre of Innovation and Technology at Jaipur, would continue to work from home, it said.

Fiat Chrysler Automobiles together with Fiat India Automobiles (FCA), FCA’s joint venture manufacturing facility in Ranjangaon, said: “The suspension is in response to the increasing prevalence of positive COVID-19 cases in Maharashtra, particularly in Pune.”

Hero MotoCorp Chairman Pawan Munjal, through two digital town hall meetings held in quick succession last week, conveyed the organisation’s commitment to stand by the employees despite the severe disruptions caused by the ongoing situation, the firm said.

Fiat would continue to be staffed with a small number of employees, who are engaged in emergency services, it added. “There will be no retrenchment of any plant employees as a result of the plant closure and all will continue to receive their salaries during this closure period,” the company said.

Hyundai, however, said they would continue production while taking necessary precautions and welfare of company' customers, employees, dealers and vendors. TVS Motor said its facilities were operating in staggered shifts. Ashok Leyland said it was continuing with the production as of now.

The economic condition of Gurugram and Manesar's industrial areas' has already been grim as the slowdown has decelerated production. Less than 15 days are left to go for an emission norms overhaul in the country and dealerships have to liquidate their BS-IV stocks. The industrial belt is home to an estimated 1,000 medium and small ancillary units. Each units employs a workforce ranging from 20 to 200 in the area.

The ultimate impact of coronavirus is still getting monitored by the Indian automakers, as in the case with all the sectors, forecasts are being jettisoned. "We have received the information that two of our members in Pune have been asked by the local police to shut their dealerships." Ashish Kale, president, Federation Of Automobile Dealers Associations (Fada).

An industry analyst said, "The problem could also arise on the demand side as people may defer buying cars now, and sales volumes getting affected with reduced number of dealership visits."

Taking Lead

*Maruti says duration of shutdown to depend on government policy
*Mahindra to begin work on how it can make ventilators at its manufacturing plants 
*Fiat, Ford, Merc, VW shut plants too; Ford promises no layoffs
*Hero MotoCorp to halt operations at all global manufacturing facilities till March 31

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