The country’s largest carmaker, Maruti Suzuki, has termed the ongoing labour unrest at its Manesar plant in Haryana a “political issue” and said it will not compromise on its principles of industrial relations.
“My understanding is that the Manesar labour problem is essentially a political issue and not a problem which involves any significant demand from the workers,” chairman RC Bhargava said while addressing the company’s annual general meeting here. Suzuki group chairman Osamu Suzuki was also present. Production of Maruti’s best-selling model, the Swift hatchback, has taken a severe hit since August 29 when the management said it would not let workers enter the plant unless they sign a “good conduct bond”.
The move came after Maruti said it had discovered attempts to “sabotage” operations at the plant and a “deliberate” compromise on the quality of cars. “We are having an unfortunate situation developing in Manesar,” Bhargava said, adding, “we are re-doubling our efforts to create a mutually productive and beneficial relationship with our workers.”
But Bhargava said this does not mean that Maruti will compromise on its established principles of industrial relations. Several shareholders present at the meeting supported the management's handling of the situation at Manesar and urged the state government to help Maruti resolve the dispute at the earliest.
“A good year of higher sales is usually followed by a year of dip in sales. I urge you not to be unduly concerned about slowdown in sales. The growth pattern for future will be re-established this year,” he said.
Bhargava said the company was going ahead with its expansion plans and doing whatever it can to preserve its market share. Maruti will be able to produce 1.7 million units from its Gurgaon and Manesar plants by 2015, he said, adding, the company is also exploring other sites where it can establish its next production lines.
He, however, expressed concern over the lack of clarity in pricing of fuel, saying it was preventing the company from making big investments in diesel engines. He said the Rs. 24-price differential between petrol and diesel has resulted in a huge demand for diesel cars.
“A large investment is required in making diesel engines. Some people in the government are talking about dual pricing on diesel and others are talking about increasing excise duty of diesel cars. We wait for policy pronouncement on this issue,” he added.