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Maruti Suzuki has announced that over 3000 temporary employees have lost their jobs. The company has stopped renewing contracts of such employees due to the continuing slowdown in the Indian auto industry.
However, LiveMint reports that R C Bhargava, Chairman, Maruti Suzuki India (MSI) has insisted that the permanent employees have not been affected by the job cuts in the company. He went on to state that contract workers will be hired when the demand for the products increase in the future.
Bhargava stated: "This is a part of the business, when demand soars, more contract workers are hired and reduced in case of low demand." He further went on to confirm the job cuts by stating, "around 3,000 temporary workers have lost jobs with Maruti Suzuki."
He also cautioned, that the slowdown in the auto industry will impact a larger scale than just automakers in the country. The industry creates jobs in various fields including sales, service, insurance, financing, petrol pumps, transportation and more; all of which will also be affected by the declining sales.
Having said this, Maruti Suzuki is expecting the auto industry to regain its momentum during the upcoming festive season in the country. The positive growth which is expected will be partly due to the lower base effect.
The Indian auto industry is currently facing its worst ever slowdown in the Indian market yet. All major automotive brands in India have been recording low sales and demand in the market, since the start of 2019.
Some of the reason for the decline is due to the increasing GST rates and the changes in the upcoming norms (both safety and emissions). These are some of the reasons, customers are shying away from purchasing cars in the market — here is everything you need to know about the auto industry slowdown in India and its effects.
Many automotive manufacturers have also announced ‘No Production Days' for long durations. With less demand for vehicles in India, production has been put to a halt to relieve pressure on the increasing inventory of manufacturers.
Thoughts On The Maruti Suzuki Job Cuts In India
Maruti Suzuki has started laying-off temporary workers in the company to reduce the losses in the market. The company has been recording its biggest decline in the Indian market, with a de-growth of over 46 percent in the previous month. However, with the festive season in India soon approaching, it will be interesting to see how it will impact the sales and demand in the country.