The largest carmaker of India, Maruti Suzuki is confronting a lockout at its Manesar facility due to violent rift between the management and workers in the recent past. The halt has led to production loss and therefore the automaker is likely to further face a loss of around 20% in business profits.
Due to the same reason, automaker has experienced a decline of around 15 to 20% in profits, posting a slash in last month sales figures. The sources express that the figures are just based on loss of production output since the company locked out its facility. Various losses on several levels at Maruti’s assembly including paint shop and other facilities based at its Haryana plant are estimated to around 525 crore.
The clash occurred at Maruti Suzuki’s Manesar plant last month was extremely violent and shocking for the complete unit. It resulted in a death of one senior official of the management along with hundreds of injured executives. Since then the automaker announced a lockout at Manesar plant, which rolls out company’s bestselling key products – hatchback Swift and sedan DZire. The work freeze is leading to a daily production loss of 1,200-1,400 cars or Rs. 75 crore.
The Senior Vice-President of equity research at Fortune Financial Services, Mahantesh Sabarad stated, “We knew that the production loss will directly impact the profit figures. Even two weeks halt at Manesar plant hamper sales and this is a long closure which will definitely lead to great loss in profits. Moreover high costs for enhancing security, covering damages at plant along with manpower expenditure will add to the value.”
- Maruti Suzuki Suffers a 100 Crore Rupee Loss Due To Strike at Manesar
- Maruti Suzuki India Experiencing Production Cut At Its Manesar Unit
- HC Declined to State the Strike Illegal at Maruti’s Manesar Unit
- Maruti Suzuki to Heighten the Safety at Manesar Unit
- Maruti Suzuki Likely To Shift Its Production Unit from Gurgaon to Manesar