Why Maruti Suzuki can’t restart production immediately at Gurugram plant despite government approval

Maruti Suzuki's Gurugram plant has been given the approval to restart operations with only 159 employees, at present.

By:Published: April 28, 2020 1:12:04 PM
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Maruti Suzuki is one of the few companies that have been allowed to restart operations in India amid the COVID-19 situation. However, the company has not been allowed to work with a full staff. Just last week, permission was granted to MSIL to operate its Manesar plant. Now, the local (Gurugram) authorities have allowed the company to restart it’s plant situated there. The condition though is that only 159 employees will be allowed to work at present. MSIL wanted at least a 3,704 person permit from the authorities. This and 31 vehicles too.  For its Manesar plant, the company had requested permission for 4,696 employees. However, it was given approval for only 600 personnel.

According to the certificate-issuing authority, Gurugram deputy commissioner,

The application is approved for permission to operate during lockdown period with only 159 employees, subject to physical inspection and submission of all necessary documents in support of their claim (declaration, SOP, photographs, etc) before the commencement of actual operation. No other manufacturing/ service activity is permitted in the unit other than those approved under the MHA guidelines during the said lockdown period, else strict action will be taken and you will be responsible for the same

Maruti Suzuki officials, according to the Indian Express, said that it is impossible to restart operations with such a small staff. A company spokesperson was quoted as saying, 

We cannot begin production with 159 people, but we can start working to ensure the readiness of the plant and implement the measures required whenever permission is granted, Also, production cannot be started because many vendors are still closed. So when the entire lockdown is lifted and all our vendors can operate, only then can we start production.

At present, component makers too are shut down. Without components or the required tooling, it is impossible to restart operations. Maruti Suzuki or any other manufacturer for that matter will require the raw materials for making a vehicle or the chassis. With the allotted skeleton staff, things will be difficult for India’s largest carmaker.

Express Drives reached out to Maruti Suzuki for a comment and the company said that when operations restart, it will be announced. So far, the auto industry is said to have lost more than 7.5 lakh units overall in terms of sales. More than $2 billion loss in revenue is estimated just in the month of March 2020. With next to no sales happening this month, the losses will further be compounded. During this pandemic, staying safe will be the highest priority of people. Any future purchases are likely going to be deferred. As it is, the auto industry was reeling under low sales pressure. Things were looking up with the BS6 transition but now it seems that the coronavirus after-effects will stay for some more time.

 

 

 

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