Toyota's manufacturing plant at Bidadi experienced its first lockdown back in January 2006. The plant is undergoing a similar situation currently and the reason remains the same - dispute in wage negotiation between the company's management and labour Union. The Bidadi factory has an annual production capacity of 310,000 units and manufactures 6 models from Toyota's portfolio. The lockdown will affect anywhere between 6,000-6,500 employees. Toyota's management and the Union officials have been having talks for over 10 months to sign a new contract while the government was also helping mediate the negotiations but no decision was ever reached. We spoke to Mr. Shekar Viswanathan, vice chairman and Whole-Time director, Toyota Kirloskar Motor, to gauge the company's reaction on this matter. (Read more about the dispute here)
What is the current status of the negotiations with the workers' Union?
The company is in talks with the government and we shall soon update you on the outcome.
Do you think the workers' stand on the higher increments is fair?
The Union is unable to understand the difficulties being faced by the company and is very rigid about their demands. In the course of the salary negotiations for FY13-14, we have had 55 bilateral meeting and 7 conciliation meetings chaired by the labor department.
What is the impact on production as a result of the lockout? And since when has the production been affected?
Under the instigation of the Union, certain sections of the employees have been resorting to deliberate stoppages of the production line, abuse and threatening of supervisors; thereby continuously disrupting business for the past 25 days.
We have had a production loss of 2000 units of planned production in these last 25 days before the lock out was declared. (Yesterday being the first day of the lock out)
Was the situation so bad that you had to declare a lockout?
Obviously the situation was enough for us to declare a lockout. The lockout is being enforced to bring discipline back to the shop floor. For the past 25 days, production levels at our plant operations have been disrupted on frivolous grounds and the abuse of our supervisory staff has continued. We need to first restore normalcy in our operations. This lack of discipline is being orchestrated by some misguided workmen employees. As it was no longer possible to ensure the safety of employees and conduct normal operations, the company decided that a lockout was its only option.
What are your current inventory levels?
Our current inventory levels are less than 500 units.
What are the models that will be impacted the most as a result of this lockout?
All the models that are manufactured in our plant.
Do you expect delays in the vehicle deliveries due to the production hit?
We will micro-manage the customers' demand by catering to their specific requirements. This will hopefully help us during this time.
