Moneycontrol
Last Updated : Jun 27, 2020 05:22 PM IST | Source: Moneycontrol.com

This week in Auto: COVID-19 cases at Bajaj Auto plant; Maharashtra freezes ‘Chinese’ MoUs

Here is a brief look at what else made headlines in the automotive space during the week

From a total of 8100 employees including contracted workers, 140 were found to be COVID-19 positive at Bajaj Auto's Aurangabad plant in Maharashtra.

This is the single largest instance of cases found from one manufacturing location. The cases surfaced despite the company following SOPs.

More on this later in the copy but here is a brief look at what else made headlines in the automotive space during the week.

Close

Audi opens bookings for RS7 Sportback

German luxury car maker Audi on Tuesday announced the opening of bookings for its all-new performance car RS 7 Sportback, which is expected to be launched in the domestic market next month.

The five-seater second-generation Audi RS7 Sportback can be booked either online or from the nearest dealership at an initial amount of Rs 10 lakh, and deliveries will commence in August, the company said in a release.

Indian co hit by Maharashtra’s Chinese MoU freeze

The decision by the Uddhav Thackeray-led Maharashtra government to put ‘Chinese’ memorandum of understanding (MoU) on hold has inadvertently hit an Indian company hard.

Foton PMI Bus Manufacturing Company, a joint venture (JV) where 70 percent equity is held by Haryana-based PMI Electro Mobility Solutions, is one of the three companies that now have their MoU on hold by the Maharashtra government.

India’s share in Suzuki’s basket goes down

Growing influence of its neighbours and the cyclical slowdown saw India report its lowest share since 2016 in Suzuki’s global automotive sales during FY20.

India’s share in Suzuki Motor Corporation’s (SMC) worldwide automotive sales ended at 50.35 percent last financial year reporting sales of 1.43 million units. A year ago, it was 52.72 percent.

Imports from China stuck at Indian ports

Auto components procured from China are very likely to face unaccounted delays after cargoes landing up on India’s sea ports are being subjected to unusual and extended scrutiny.

Several auto component and vehicle manufacturing companies have complained of ‘very high’ congestion at the Mumbai port after their shipments that sailed from China got stuck.

Honda opens bookings for the new City

Honda has officially opened up bookings for the next-gen Honda City. The car's launch was pushed back due to the lockdown and the launch will now finally take place in July.

The company has started accepting bookings for the car and deliveries too, are expected to begin from July onwards. 300 Honda dealerships across the country are operational.

Bajaj Auto hit by COVID-19 cases

Two workers who lost their lives were among the 140 confirmed COVID-19 positive cases found at the Bajaj Auto plant in Aurangabad, the Pune-based company said on on June 26.

This is the first time that Bajaj Auto has reported COVID-19 positive case since easing of the lockdown restrictions and partial resumption of production activity.

This is also the first in corporate India that such a large number of COVID-19 positive cases have been found from a single manufacturing location.

In earlier instances, workers at Maruti Suzuki and Hyundai plants were reported to have contracted the disease. The Tamil Nadu chief minister had even decided to enforce another lockdown in the Chennai and Kanchipuram districts (having multiple auto plants) to restrict the spread.

The cases have been detected despite the affected companies claiming to have put in place the standard operating procedures (SOPs) formed internally and also those mandated by the state and district administration.

“Either the rules were not followed or plant heads were not alert. In both conditions this does not augur well for the rest of the manufacturing industry and not just the automotive industry”, said a mid-level executive of a tyre manufacturing company.

Before getting the green signal automotive companies were busy convincing the state governments to allow them to restart production operations after having kept them shut for more than 40 continuous days.

While at first states allowed only negligible staff to return to work, the cap was revised upwards to 30 percent in subsequent days. Some companies are presently operating at 50 percent of their worker strength. Subdued demand conditions have prevented the companies to ramp up production to 100 percent levels.

Maintaining social distance, adhering to sanitation norms and avoiding public transport were some of the several SOPs formed by the industry.

Entry and exit of non-employees to and from the offices and manufacturing plants were strictly controlled.

However a vehicle is made of hundreds of parts, most of which are produced by vendor partners. Constant unhindered supply of such parts to feed the plants continuously is required which raises the risk of COVID-19 transmission.

“If cases continue to grow it may force the state or the central authorities to put in some undesired counter measures. This could be stoppage of production or reduction in number of workers,” the executive mentioned above feared.

Almost all automotive plants in India have now become operational. 70-80 percent of showrooms have also reopened. Demand has started to pick up although showroom footfalls have been low. Several enquiries have come through the digital means.

After cases of redundancies and cut back in salaries and other overheads auto companies were hoping to scale up production and introduce new products in the market. If their manufacturing plants do not keep the disease at bay output will take an impact.
First Published on Jun 27, 2020 05:22 pm
Sections