Home >Companies >News >Covid cases at factories leave India Inc in a bind

Six covid-19 deaths at Bajaj Auto Ltd’s Aurangabad plant in Maharashtra have set off alarm bells across India’s manufacturing hubs, prompting companies to revaluate contingency plans and emergency responses.

Several industry representatives said the increased risk of an outbreak weighs heavily on India Inc.’s decision-makers as they were considering ramping up production gradually, following the easing of lockdown measures and demand revival in certain sectors.

Experts said many companies will increasingly have to make the difficult choice between business continuity and saving lives.

Around 300 workers at the Aurangabad plant have tested positive, according to a few people aware of the developing situation.

While Bajaj Auto continued with its operations at the plant in Aurangabad, after the first reported case, it is now facing pressure from workers to stop operations as infection numbers continue to rise.

Mint reported on Saturday that workers’ unions at Bajaj Auto, India’s biggest exporter of motorbikes, are demanding a temporary closure. Industry experts said such episodes will have a huge impact on production cycles of the manufacturing sector, putting business performances under severe strain.

“We are stressed because of the rising number of covid-19 cases, since production cannot be stopped as that would lead to increased losses. Assembly lines are operated with fewer people, movement of employees has been restricted, and canteens are being operated for longer hours to maintain social distancing as much as possible. As and when cases emerge, sanitization takes place but increasing production is tough in such circumstances," said an executive at a leading component manufacturing company.

Taking note of the Bajaj Auto episode, other vehicle manufacturers have become more vigilant and are strictly enforcing the standard operating procedures before restarting production. India’s largest carmaker Maruti has installed partitions on shop floors to ensure compliance with social distancing norms. It has issued a separate set of guidelines for common areas.

Experts said the coronavirus among workers will remain a key business risk for corporations despite more preventive measures.

“Covid positive cases will be found regardless, and production activities will have to stop for sanitization and contact tracing, and restart again. Automakers will have to build the habit in their employees to live with the virus," said Puneet Gupta, associate director, IHS Markit, a global research and consultancy. “Engine assembly and other assembly shops are the most critical areas in factories where covid can spread and it’s almost impossible to avoid social distancing there."

It is not possible for manufacturing to wait until a vaccine is developed, he added.

Hyundai Motor India Ltd, the second largest passenger vehicle manufacturer in India, had shut down its Chennai unit for an indefinite period starting 23 March, due to a rise in covid-19 cases. Toyota Motor Corp., which reported a fresh case on 3 July at the Bidadi plant near Bengaluru, has so far seen eight positive cases.

amit.p@livemint.com

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