The Hindu Business Line : Auto-makers feel heat of truckers' stir — Many may be forced to suspend production

LEADING car makers said today they would be forced to suspend production and feared huge losses if the truckers' strike continues even as the standoff between the truckers' union and the Government shows no signs of a resolution.

Telco and Kinetic Engineering officials said they may have to suspend production if the truckers' strike continues for the next couple of days. India's largest car-maker, Maruti Udyog had warned earlier that it may have to suspend production if the truckers' strike does not end soon. The four-day-old strike has crippled freight movement across the nation with the total loss of businesses estimated at Rs 2,000 crore a day.

A Toyota-Kirloskar Motor Company official admitted that the strike could affect their production and delivery schedules. "We will surely be affected if the strike continues. But we hope to recover the losses because of our flexible production system," the Toyota-Kirloskar Motor Ltd Deputy Managing Director, Mr K.K. Swamy, told Business Line.

Sources in Toyota said while the delivery schedule of its flagship vehicle, Qualis will get affected, high-end cars like Corolla which has an order backlog of around 2,000 may not get hit. The waiting period of Corolla is around two months. Toyota produces around 100 Qualis a day. Toyota follows the just-in-time model of production, which ensures that the inventory is kept at a minimum, which pegs down the costs without disrupting the delivery schedule.

A Tata Engineering official said the company is considering a plan to suspend production of its vehicles. "If the truckers' strike continues for the next 2-3 days, we will have to suspend production. Our supplies are stuck at various locations across the country at the moment," a Tata Engineering official said. He said the company's supply of Cummins engines from Jamshedpur are currently stuck at Nagpur while several supplies originating from the South too are stuck at various points.

Kinetic Engineering, which makes two-wheelers, said the situation was grim. "There is a very serious impact of the truckers strike. Production has already been affected and if the strike continues, we might have to suspend production in a day or two," Mr Arun Firodia, Chairman, Kinetic Engineering Ltd, said.

Sources in Hyundai and Ford, whose manufacturing plants are based out of Tamil Nadu, said that they too may face losses if the strike continues. As March saw automobile makers posting extremely high sales, the stocks with the dealers are extremely low which in turn has affected the delivery schedule. "Customers' complaints have increased but we are helpless," one of the dealers said.

Auto component makers too are feeling the heat. "We might have to halt production in about 2-3 days, if the strike continues. Supply of raw material to the plant is getting affected. In turn, supplies to OEMs will also be affected," Mr K. Mohan, President & Director, Fenner India Ltd, said.

The All-India Motor Transport Congress, which represents a majority of the truckers, has put forth a 10-point charter to the Government which includes an end to frequent rise in diesel, exclusion from a planned value-added tax and repeal of an order to scrap 15-year-old trucks.

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