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Toyota hangs up production due to labour unrest at two auto assembly plants

18 March, 2014
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Toyota has recently delayed its production cycle from its two Indian auto assembly plants in light of threats against management and "deliberate" assembly-line stoppages, as exertions to pound out a labour deal fizzled.

The world's grandest automaker said the move will see the lock-out of something like 6,400 workers at the production lines in south India, a move that was censured as "illegal" by a union representative.

"In the meantime, under the instigation of the union, certain sections of the employees have resorted to deliberate stoppages of the production line, abuse and threatening of supervisors thereby continuously disrupting business for the past 25 days," Toyota said in a statement.

Toyota hangs up production due to labour unrest at two auto assembly plants

"All these unlawful activities have been detailed in the lock-out notice. With this background, the company is left with no other option but to declare a lock-out of the premises to ensure the safety of its workers and management personnel," it added.

"The lockout is illegal as management did not give the mandatory 14-day notice to employees and the state labour office, said Prasanna Kumar of the Motor Corporation Employees' Union.

"The lockout was declared unilaterally though we have been negotiating with management on wage hike for this fiscal (year) for 10 months."

The two plants, close to the city of Bangalore, handle about 310,000 units yearly, basically for the household market.

On Monday, the Toyota agent said there had not been any reports of physical ill-use of supervisors or laborers at its presently covered plants.

"There is a sense of caution among businesses expanding into the Indian market," said Yosuke Miura, analyst at Tokai Tokyo Securities.

"All companies that invest in India take this kind of a risk, to varying degrees. It's tough to know what will come out of this. But what is important for Toyota and others investing in India is to keep up communication with people working at their factories."

By Abhishek
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