Ashok Leyland, India's Major Truck-Maker, Announces 5-Day Shutdown At Chennai Plant

Ashok Leyland, India’s major truck-maker, announced a 5-day shutdown at its Chennai plant on Thursday. In August also, the company had observed a forced 10-day ‘holiday’ due to massive slump in sales of the vehicles. According to the notice issued by the company, ‘The measure is due to continuing sluggishness and contraction in commercial vehicle market. The need has arisen to continue the corrective actions to safeguard the interest of the company.’

Ashok Leyland issued notice to the employees that the plant will not be working on September 6 and 7 of this week and September 10 and 11 of next week, while September 9 has already been declared as sixth non-working day. In effect, this would mean that the factory will not be operating till September 11.

The Hinduja flagship firm reported a 47 per cent decline in total commercial vehicle sales at 9,231 units in August. The company had posted sales of 17,386 units in the year-ago month, Ashok Leyland said in a statement. The medium and heavy commercial vehicle sales stood at 5,349 units last month as against 13,158 units in August 2018, down 59 per cent.

Light commercial vehicle sales stood at 3,882 units as compared with 4,228 units in August last year, a dip of 8 per cent, it said. 

Earlier on September 4, the country's largest carmaker Maruti Suzuki India (MSI) announced similar ‘no production days’ at its Gurugram and Manesar plants. Reeling under severe slowdown, the auto major had reduced its production by 33.99 per cent in August, making it the seventh straight month of reduction. The company produced a total of 1,11,370 units in August as against 1,68,725 units in the year-ago month.

Passenger vehicles' production last month stood at 1,10,214 units as against 1,66,161 units in August 2018, a decline of 33.67 per cent. In July, the automaker had cut its production by 25.15 percent to 1,33,625 units. On September 1, the company had reported a 33 per cent dip in total sales last month at 1,06,413 units as compared with 1,58,189 units in August 2018.

The announcement comes a day after Union Minister Nitin Gadkari assured the slowdown-hit auto sector that the Narendra Modi government will provide all possible support to the companies. Reiterating that the government would help the industry, the road transport and highways minister also said his ministry would give out 68 road projects worth up to Rs 5 lakh crore in the next three months to help generate demand for commercial vehicles.

(With agency inputs)

HIGHLIGHTS

• In August also, the company had observed a forced 10-day ‘holiday’.
• Earlier, Maruti Suzuki India announced similar ‘no production days’.
• On Thursday, Modi minister had given assurance to crisis-hit auto sector.