Ashok Leyland to offer VRS, reassign staff to cut costs

Written by fe Bureau | Chennai | Updated: Dec 5 2013, 14:30pm hrs
Vinod DasariAshok Leyland MD Vinod K Dasari
Hit hard by months of declining sales coupled with rising debts, automobile maker Ashok Leyland (ALL) has decided to cut flab in the executive segment through VRS as well as embark upon cutting fixed costs by re-assigning some of the staff at the plant level towards the sales front, said Ashok Leyland MD Vinod K Dasari.

The company is firm on bringing down its debt by Rs 1,000 crore during the fiscal and sees the revival of CV sector only after five to six months. The company will parade new products, including NTruck CNG and and passenger versions of its LCV, at the ensuing Auto Expo in February, he added.

Responding to questions on the sidelines of four-day SIMCOMVEC, the 8th International Mobility Conference, Dasari said: We came out with a voluntary retirement scheme in November wherein nearly 500 executives participated (10% of the executives of the company). Both experienced and newcomers took part in this exercise. Similarly, the company moved 50 existing staff working in the plants to sales front to reach out to more customers across the country to shore up sales and we plan to move another 250 such staff to sales and other operations.

The company also took a gamble in launching new products to not only partially offset the slowdown blues but also bring new customers.It also expanded its dealer and parts network by adding 200 such outlets across the country during the fiscal. In the last three to four years, ALL has more than doubled its dealership network in the country, which crossed 500 mark, he added.

We see the slowdown as an opportunity to innovate and strategically take many decisions and the company is firm on bringing its debt by R1,000 crore during the fiscal, Dasari said. We dont see things to improve faster in the next six months or even in next one year. However, we expect Q4 would be better than earlier quarters and will give some hope for the OEMs. It is time for government to look at policies which will boost infrastructure.