Why jump-starting car factories in India is no easy ride

After weeks of staying shut, car factories cannot be suddenly thrown open for production because other key factors like component supply need attention as well.
By : PTI
| Updated on: 28 Apr 2020, 08:39 AM
Factors such as supply-chain issues getting sorted and delaerships returning to work are crucial before care factories can roar back to life once again. (Image used for representational purpose) (REUTERS)
Factors such as supply-chain issues getting sorted and delaerships returning to work are crucial before care factories can roar back to life once again. (Image used for representational purpose) (REUTERS)
Factors such as supply-chain issues getting sorted and delaerships returning to work are crucial before care factories can roar back to life once again. (Image used for representational purpose) (REUTERS)
Factors such as supply-chain issues getting sorted and delaerships returning to work are crucial before care factories can roar back to life once again. (Image used for representational purpose)

A week after the Centre announced allowing of partial resumption of production by industries, automobile companies including Maruti Suzuki, Hyundai, Toyota, Tata Motors, Ford and Mercedes-Benz are yet to resume production stating supply chain, not just component suppliers but also dealers, needs to start operating to re-start production.

The companies said in most parts of the country most of the auto dealers and suppliers continue to be in a lockdown condition.

(Also read: Not a single car sold? Auto makers in India may be bowled out for duck in April)

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When contacted a Maruti Suzuki India (MSI) official said the company is yet to resume production.

Last week, the Haryana government had granted permission to the company to restart its Manesar-based manufacturing facility but company Chairman R C Bhargava had said MSI would start operations whenever it can maintain continuous production and sell vehicles, "which is not possible at this point of time". (Full report here)

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Similarly, a Hyundai Motor India official said the company hasn't started production yet as Tamil Nadu continues to be under a strict lockdown.

When reached out for comments, a Ford India spokesperson said, "At this point the plant is shut till May 3. So decision on the resumption will be taken around the end of the month. Scale and intensity will be decided at that time."

Earlier in the day, a Toyota Kirloskar Motor (TKM) spokesperson said, "For the auto sector to start production it is necessary that our supply chain starts operating which means not only the suppliers but also the dealers. Currently, because of lockdown in many parts of the country, most of the auto dealers and suppliers continue to be in a lockdown condition."

(Also read: Longer lockdown will badly hurt auto component clusters in NCR and Pune)

TKM will follow the lockdown orders until further notice from the government and continue working in concurrence with the state and central governments' directives, the spokesperson added.

Tata Motors did not comment but sources said the company is yet to resume operations at its different manufacturing locations as the company is also waiting for the whole supply chain - components to dealers - to be ready.

Mercedes Benz India also said, "Lockdown continues as per central and state government directives."

Two-wheeler makers Honda Motorcycle and Scooter India (HMSI) and Yamaha Motor India had said they were hopeful of resuming manufacturing operations at their respective plants after the lockdown is lifted amid supply chain and workforce related challenges.

The home ministry had allowed industrial units to resume partial production in manufacturing units in rural areas and outside municipal limits from April 21 under strict safety and hygiene conditions with an eye on restarting economic activity.

First Published Date: 28 Apr 2020, 08:39 AM IST
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