India’s supplier association is playing down suggestions Maruti-Suzuki could move its operations from its riot-torn Manesar plant to more peaceful operations in the West of the country.
The automaker was rocked by a violent mob rampaging through the Manesar factory near Delhi last week, resulting in the death of one senior employee and a massive fire wrecking management offices, leading the company to shut down the site.
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“I am not so sure it is easy to move lock, stock and barrel,” Automotive Component Manufacturers Association (ACMA) executive director, Vinnie Mehta, told just-auto from Delhi.
“Maruti has officially denied they could move.”
ACMA counts 650 members in India, some 270 of which are located in the north of the country and near to Maruti-Suzuki, which accounts for 40% of the country’s passenger vehicles.
Any move by the company to seek an alternative base for its operations could have a major impact on local suppliers. There are 150 Tier 1 suppliers in India, according to ACMA, with a further 500 – 600 Tier 2 component manufacturers.
However, of this number around 50% – 60%, are located in the National Capital Region belt in the north.
The Manesar site has been plagued by labour unrest for years and the recent visit of the western State of Gujarat, Chief Minister, Shri Narendra Modi, to Japan, is sure to provoke speculation as to Maruti’s continued future in northern India.
“It is very worrying for our members, not just from a production point of view, but from an industrial relations point of view,” said Mehta. “This is something really unfathomable that has happened.”
Around 3,000 staff at Maruti’s Manesar plant remain at home following the lock-out and as many of them are contract-based, it is unlikely they are being paid.
The plant shut-down will continue until Maruti says it has received assurances the site is completely safe and secure to return.
The Manesar factory assembles Maruti’s top-selling Swift and Dzire models, producing around 1,600 vehicles worth US$12.5m a day.
Maruti-Suzuki was not immediately available for comment.
