Maruti had been in a tight spot in the last three quarters as vehicle sales have been subdued
Maruti Suzuki has started testing its first electric vehicles based on its popular hatchback Wagon R
New Delhi: In the midst of a deepening slowdown in India’s automotive industry, Maruti Suzuki India will not retrench any from his 16,050-strong permanent workforce in the near future, chairman R C Bhargava said on Tuesday at the annual general meeting of the company in the national capital.
According to the octogenarian, Maruti has not renewed contracts of around 3,000 of his contractual workers but has not downsized its workforce. Contractual workers give flexibility to the operations of the company, Bhargava added.
India’s auto sales declined for the ninth straight month in July, with automotive manufacturers are laying off workers and suspending production to keep costs in check. Wholesale dispatches of passenger vehicles during the month fell 31% year on year to 200,790 units, according to data from the Society of Indian Automobile Manufacturers (Siam). It was the worst sales performance since a 35% decline in December 2000.
Bhargava was hopeful that the steps announced by the government last week to boost the Indian economy will go a long way in reviving demand in the domestic market.
“Some of the measures announced by the government are very good and faster availability of GST refunds will fuel the further growth. Also the assurance from government that bankers will not attract punitive measures for bonafide commercial decisions will also help," said Bhargava in response to a question from a shareholder.
To boost demand for automobiles and arrest the precipitous decline in sales the government on Friday announced a slew of measures like mandating government agencies and departments to replace old vehicles, increasing depreciation on new vehicles for commercial fleet service providers, urging banks to make automobile loans cheaper, and increase credit availability to non-banking finance companies.
Finance minister Nirmala Sitharaman also assured buyers and manufacturers that vehicles compliant with Bharat Stage IV emission norms registered before March 31, 2020, will be able to run for the entire registration period or the life of the vehicle.
The announcements, industry executives believe, will boost the morale of companies and customers alike, just before the festival season.