The economic slowdown is clear and present. Automobile giants like Tata and Volkswagen are heading towards halting the production. An article published in Indian Express says -
Automobile majors Tata Motors and Volkswagen are planning
stop-production (block closure) this month in Pune. The companies say there has
been a drop in end-user demand “because of slowdown”. While Tata Motors has
confirmed a three-day block closure, Volkswagen workers’ union claims that the
company is planning a month-long block closure soon.
Debasis Ray, head (corporate communication), Tata Motors, said, “The
Pune commercial vehicle plant will have a block closure on June 22, 23 and 24
to align production with demand.”
During this block closure, employees will be paid half a day’s salary
per day of the closure.
Tata Motors had undertaken block closure in 2008 and 2009, when
production was stopped for three and five days respectively.
At Volkswagen’s Chakan plant, the company will be observing a five-day
week instead of the usual six days. “For the past 15 days our production has
come down from 430 vehicles per day to 400 per week. We expect this trend to
continue till December,” said a source from the company.
However, the company’s head of communications, Alexander Skibbe denied
any plans of block closure in Volkswagen or reduction in production.
Anant Sardeshmukh, executive director general, Mahratta Chamber Of
Commerce Industries and Agriculture, said the automotive sector is facing 15 to
20 per cent crunch in demand, which could be the beginning of a slowdown.
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