CHENNAI: One of Chennai’s largest automobile manufacturers, Renault Nissan Alliance in Oragadam, is now in the spotlight as the company has stated that it will be “optimising” production. Sources, both among workers and management, say this is likely to lead to a significant number of temporary jobs being cut.
With sales of both alliance partners witnessing steady declines in the last few months, sources within the plant say that many jobs are likely to face the axe. Though sources confirmed that the job cuts will be primarily among the temporary workforce, there is speculation regarding the number of staff that will be handed out pink slips. Some management sources say less than 500, while others believe 1,500 workers may be asked to leave. Management sources also confirmed that permanent workers in the plant, of which there are around 6,000, will not face the axe. The plant has a total of nearly 8,000 workers on the production line.
The company, while declining to comment on the number, only stated that there will be an optimisation of production. “India is a dynamic market. To adapt to the volatile business environment and remain consistent to our strategy, Renault-Nissan is continuously adapting to market needs to optimise manufacturing operations,” said a Nissan India spokesperson.
The company refused to comment when asked if the optimisation would involve both a reduction in production and workforce. However, the company said that none of the figures quoted thus far in media reports were accurate. “None of the figures are accurate. Not 500, not 1,000 and not 3,000,” said a spokesperson.
This decision comes in the wake of declining sales. Industry figures show that the number of units Nissan has sold over the past few months has steadily declined. In April 2015, the company sold 4,259 units, dropping to 3,681 units in May, 3,357 units in June and 2,841 units in July. For Renault, the numbers have been 4,001 units for April, 3,601 units in May, 4,340 units in June before plunging to 1,686 units in July. Sources within the company say that letting go of contracted workers when the market is poor is not new.