Optimizing output at India plant — Renault-Nissan

The downsizing began months ago and comes in the wake of a similar action involving trainees earlier, which prompted almost 30 trainees to file a case at a labour court here last month seeking reinstatement, sources said.

The Franco-Japanese group made this decision due to not so good sales that were caused by the slow pace of new product launches and also because of competitors like Maruti Suzuki India Ltd. that has a market share of 48% and Hyundai Motor Co. which is standing strong at 17%.

One of Chennai’s largest automobile manufacturers, Renault Nissan Alliance in Oragadam, is now in the spotlight as the company has stated that it will be “optimising” production. Some management sources say less than 500, while others believe 1,500 workers may be asked to leave. “Today we are in a situation where we need to adapt slightly the workforce for our plant”. A total of about 8,000 workers report at the plant, which has no workers’ union.

The company, while declining to comment on the number, only stated that there will be an optimisation of production.

Guillaume Sicard, president of Nissan India, said that “Domestic sales are going through ups and downs”. The plant has a capacity to produce 400,000 units annually and makes Renault, Nissan and Datsun brand vehicles. “None of the figures are accurate”. It estimated that around 1,000 temporary workers have been told to go.

According to SIAM numbers Nissan’s sales has been coming down. For Renault India, auto sales have not declined, but have not grown either. In April 2015 the company sold 4,259 units, which dropped to 3,681 units in May, in June further it was reduced to 3,357 units and 2,841 units. In a separate statement the company spokesperson said that India is a dynamic market.