Daimler to halt production at Chennai plant till October 7
Daimler India Commercial Vehicles (DICV) will halt operations at its Chennai plant till October 7, said a source from the company, speaking to CNBC-TV18. The decision to shut the plant, located in the city’s automobile corridor, Oragadam, comes in the wake of tepid demand and piled up inventory. The official who spoke to CNBC-TV18 added that the plant shutdown began on September 25 and is expected to continue till October 7, 2019.
Daimler India Commercial Vehicles (DICV) will halt operations at its Chennai plant till October 7, said a source from the company, speaking to CNBC-TV18. The decision to shut the plant, located in the city’s automobile corridor, Oragadam, comes in the wake of tepid demand and piled up inventory. The official who spoke to CNBC-TV18 added that the plant shutdown began on September 25 and is expected to continue till October 7, 2019.
“The company’s production staff alone have been told to not turn up to work on these days,” said the official, “There was no formal communication that was sent to these teams; they were communicated of the shutdown informally.”
CNBC-TV18 learns that while approximately 1,500 of Daimler India’s production staff will not turn up to plant, its other departments — Sales & Marketing, Customer Service and R&D — and multiple project teams will continue to work as per regular schedules. However, the source added that employees’ earned leave privileges had been revoked, presumably as a cost-cutting measure in the wake of tepid demand and falling sales.
Responding to CNBC-TV18’s queries, a Daimler India Commercial Vehicles spokesperson confirmed, in a statement, that the company had shut its plant for a number of days in September and October, but did not specify till when. “We can confirm that DICV will have three non-production days in September and three non-production days in October,” said the statement, “We are also closely monitoring the situation and adjusting our production line depending on market demand. Please understand that we will not comment further”
While the industry recorded healthy sales numbers in 2018 — 3.78 lakh trucks were sold that year — the company has indicated that it expects truck sales to dip by over 25 percent by the end of the year. This means that it expects the industry to sell only 2.7 to 2.9 lakh trucks in 2019, owing to falling demand.
With the shutdown, DICV joins the list of automobile manufacturers to halt production at their respective plants. This includes the likes of Maruti Suzuki and Ashok Leyland, to name a few. Daimler has said in the past that it has plans to make its Chennai plant an export base for BS-6 vehicles from 2020 onwards.
First Published: Sept 27, 2019 4:14 PM IST
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