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Wednesday, July 11, 2001



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Bajaj Auto to go 5-day week at Akurdi plant

Our Bureau

PUNE, July 10

TWO- and three-wheeler manufacturer Bajaj Auto will resort to a 5-day production week at its Akurdi facilities beginning Friday, July 13, in a bid to tide over the recession in the market and falling demand for scooters.

The company has imposed a 30 per cent cut in production since July 1, company sources told Business Line on Tuesday, adding the move was in response to a pile-up of inventory at its facilities, depot and dealer community.

``We have a stock of approximately over 80,000 two-wheelers right now, of which the Akurdi facility is holding 30,000 units,'' sources said, adding the remaining numbers were at the depot and with dealers.

The company's top brass, including the President, Mr Rajeev Bajaj, and the Vice-President, Finance, Mr Sanjiv Bajaj, were closeted in a meeting throughout the day and remained unavailable for comment.

According to information available with Business Line, the management convened a series of meetings with the recognised Bharatiya Kamgar Sena union last week during the course of which it laid down its cards on the table.

In addition to the steep drop in demand for scooters and the rising inventory levels, company officials reportedly also spoke about the huge amount of money due to it from its dealer community.

The five-day production schedule, which comes into force this week-end, will see workers on its production lines taking a pay cut of half a day every week, amounting to loss of wages for two days every month.

Bajaj's tool-rooms, R&D, paintshop and maintenance divisions will continue to function with skeletal staff while the gear shop will function as normal since it supplies gears for the company's operations at Waluj and Chakan.

Company sources said over 3,000 workers on its production line for scooters, M-80s and commercial three-wheelers will be affected by the pay cut.

According to information available with Business Line, the 5-day week schedule will apply only to its Akurdi plant since the union had agreed to such a procedure in the event of a need arising for it in its 1993 wage agreement with the management.

The management has reportedly assured the union that it would review the situation every fortnight and keep them updated about the length of the current cut-back in production. This is the second time this year that Bajaj Auto has resorted to production cuts. The first time was in January when it went for a week-long block closure. Bajaj Auto had also resorted to a five-day week in June last year when it continued with the production cut for two months.

Bajaj's production and sales figures meanwhile show only a marginal gap between actual production and sales. The company produced a total of 1,10,836 units including scooters, motorcycles and three-wheelers in June 2001 and sold 98,397 units in the month .

The company produced a total of 3,17,874 units and sold 3,13,303 units in April-June 2001 as against 3,27,075 units produced and 3,25,360 units sold in the first quarter of the last fiscal.

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