A demand slump has prompted Tata Motors and its subsidiary TML Drivelines to enforce a block closure for two days from Wednesday.
This will be the second production pause in less than three weeks. Earlier, from August 29, the automobile major had suspended operations for three days.
A break in production means that the 8,000-plus employees at Tata Motors and TML Drivelines will be paid only half a day’s salary for every day the plants remain closed.
A notice issued by the automobile major on Saturday read that it would go for the shutdown on September 18-19 and resume production on September 20. Diesel engine-maker Tata Cummins will, however, take a decision in this regard on Monday.
According to sources, the decision to halt production is being taken to ensure that the supply matches the demand for trucks and inventories remain at current levels.
“The closure, which will be observed on Wednesday and Thursday, is aimed at preventing unnecessary build up of inventory in the company as well as at the dealers’ end. The decision for a block closure was taken keeping in view the present market scenario,” said Captain P.J. Singh, the company’s spokesperson.
Telco Workers’ Union vice-president Santosh Singh said the fall in the demand of heavy commercial vehicles had compelled the twin block closures at Tata Motors in quick succession.
“The situation is deteriorating every day. There are no signs of improvement in economy, particularly in the automobile sector,” he said.
The company spokesperson added that they were expecting another shutdown by the end of the month.
The two-day block closure will also hit hard the ancillary units in Adityapur, which are already struggling to survive the downturn and had handed out 800 pink slips in five months.
There are over 200 ancillary units that supply auto components and spare parts to Tata Motors.
The condition of most of the ancillary units is pitiable. “It is difficult to retain workers. Barring working and emergency expenses that are essential to keep the unit functional, we cannot meet other costs,” said the owner of an ancillary unit of Tata Motors in the industrial town in Seriakela-Kharsawan.
In addition to these units, there are 300 factories, which supply intermediate products to these ancillary units.
As the supply of spare parts and auto components from ancillary units to the mother plant has stopped or is a trickle, the smaller factories are facing a closure threat too.