Jamshedpur: Adityapur small industries facing block closures

Owners of around 600 of the 800 auto units in the Adityapur industrial area (AIA) supplying parts and spares to Tata Motors' plant here are a worried lot, having experienced two block closures from the auto major in November itself. Tata Motors, which turns out heavy commercial vehicles (HCVs) at its plant here, has in view of the current sluggish demand, decided to take a second block closure during the month, for five days between November 25 and 29. "Around 80% of us have shut down units and laid off workers," said Adityapur Small Industries Association (ASIA) President SN Thakur.

Taking the earlier shut down into consideration, the units would have effectively run for only 15 days during the month of November. Depending upon individual size and production capacities, the ancillary units together are estimated to take a hit in excess of Rs 500 crore during November as liabilities like payment of power bill, interest on bank loans/overdraft, payment to laid off workers including key personnel on half-pay basis, etc, cannot be avoided. Most affected are the small and big sheet metal and engineering units who work for suppliers of parts and spares to Tata Motors, and those supplying parts and spares like gears, axles, doors, etc, directly to the auto major. According to the ASIA president, most of the units have for some months now been already running at around one-third of their capacity, as Tata Motors has been turning out around 150-200 HCV chassis a day in recent months compared to around 600-650 units during this time last year. "We had already been victimised by low production and this block closures have come as a secondary hit," Tata Motors has already said that the slowdown in sales of its HCVs would call "for appropriate action from time to time to match the production with demand and avoid unnecessary build-up of inventories in the company or with its dealers".

Probably Related Posts by Labels

Widget by Hoctro | Jack Book