Hit hard by the dwindling sales over the months coupled with the lockdown due to the Covid-19 pandemic, TVS Motor Company said it has rolled out a temporary salary reduction across levels for a period of six months. Companies such as Apollo Tyres, among others, recently announced pay cuts across categories. When contacted, a company spokesperson said, “In the wake of the unprecedented crisis, TVS Motor Company has rolled out a temporary salary reduction across different levels for a period of six months (May to October, 2020). There will be no salary reduction at the workmen level. However, there will be 5% salary reduction at the junior executive level and about 15% to 20% at the senior management level. It was heartening to see employees coming forward and offering to take salary reduction voluntarily.”
Despite zero sales in April, most auto companies have paid salaries. Bajaj Auto too announced a pay cut but withdrew the same later.It may be recalled that the entire automotive industry has gone through a crisis for over a year now due to overall economic slowdown, lack of consumer interest, and liquidity crisis, among other reasons. When things started looking up in the February-March period, the global Covid-19 pandemic brought a rude shock to the entire industry and forced the companies to close down operations in the third week of March, which further put pressure on the industry.
With predictions by pundits showing no turnaround even in this fiscal, with a double-digit degrowth, auto companies have been pushed to take up austerity measures, including pay cuts for employees, job cuts, cost-cutting at operationa levels and so on. It remains to be seen how things will play out going forward, sources pointed out.
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