Strike, strife, layoffs and shortfall in stocks are all expected to haunt Maruti Suzuki India Limited as the problems escalate and lock out continues at the Manesar Plant. The company workers went on a rampage last Wednesday which saw a General Manager HR being burnt to death and 90 other injured in the mayhem that followed.
Top officials have negated the possibility of any workers involved in the violence being retained on company registers. There was no way in which the company would be reinstating these workers once the lock out is lifted. This should send a stern message to workers in the future so that discipline is maintained once the company commences production.
However, Haryana Government may urge the company to take a more sympathetic stand as it was not feasible to dismiss such a large number of workers. Whether Maruti Suzuki adheres or not is to be seen. In the meantime, the company is already exploring fresh hiring as nearly 600 workers will be laid off.
In the meanwhile with the company productions hut for nearly a week, stocks are running low and Maruti Swift may face shortage in the market. This will result in long waiting periods and could affect sales. Maruti Swift has been a major seller in Indian markets.
The company sold 55,216 units of Swift in just three months of this year while they recorded a 68% increase YoY. Dzire too saw increased demand with the company selling between 32,000 to 35,000 cars per month. The car already has a waiting period of 2 to 3 months and with supplies stalled; this period will be further extended indefinitely which will positively have an adverse effect on market share.