Scania's India bus business in trouble

Scania had invested around Rs 300 crore to set up two plants, one for trucks and the other one for buses at Narasapura.

However, the bus and truck chassis production continues to stay in-house as before.

The current production capacity of the plant is 2,500 trucks and 1,000 buses.

“The premium segment in the bus business in India is very small and the numbers have not been sufficient to enable profitability for Scania, the order book is slow. We continue to have ready stock on the yard. Due to which, it has become unviable to continue bus building operations at our Narasapura premises,” Scania in its statement said.

While an estimated 500 workers have been impacted, largely contract workers.

The company has admitted that 111 employees on the Scania payroll have been affected due to the shutdown of the bus body manufacturing unit and 44 employees will be redeployed within Scania India and globally.

Currently, the company doesn't have any outstanding orders. However, the company have ready stock available for any market requirement as they move from in-house to outsource bus body production.

The company claimed being a 'responsible employer' will do right to its people’ and has offered 'Severance Scheme' to all impacted employees.