The entrance to Telcon in Jamshedpur that will shut down for two days from Friday. Picture by Animesh Sengupta
Production will come to a grinding halt for two days from Friday at the Jamshedpur-based plant of Telcon, a Tata Motors subsidiary, to optimise operational cost due to the global slowdown in the automobile and construction sectors.
This will be the second such shutdown of the company in the past one month. The construction equipment manufacturing firm had earlier shut down operations for six days — from June 11 to 16.
Despite the jittery industrial climate, however, in its official statement, the company did not officially admit to terms such as “slump” or “slowdown”, putting the shutdown under “maintenance activity”.
“The shutdown is a continuation of maintenance activity. Sunday is a general holiday. The company will reopen on Monday,” a company spokesperson who did not want to come on record told The Telegraph.
According to the spokesperson, a similar two-day shutdown took place at the company’s two other plants in Kharagpur (Bengal) and Dharwad (Karnataka) on July 2 and 3.
The Friday-Saturday shutdown will affect 950 employees on Telcon rolls. Employees would be paid 50 per cent of their salary while the rest of the 50 per cent would be adjusted against leave, the spokesperson added.
Till April, Telcon, which produces heavy earthmovers — excavators, cranes and back-loaders — was working on a target of 650-700 vehicles per month. But in June, the target dropped below 600. Right now, the scare is that targets may drop even further.
More forthcoming than the management was the president of Telcon Workers’ Union Ram Chandra.
He revealed that the company’s monthly production target had seen a fall of around 45 per cent due to the slowdown in the automobile and related sectors.
“The sale of heavy vehicles has shown a southward trend in the last two months. Monsoon has further aggravated the situation,” he said, explaining that this period every year was traditionally dull for the sale of vehicles, but the slump made it worse this time.
Jamshedpur is witnessing regular enforced shutdowns in this fiscal year. Tata Motors, subsidiary TML Drivelines Limited and joint venture with US-based Cummins Inc., Tata Cummins, also shut operations for three days from June 28 as a cost-cutting measure and to keep their inventory under control.