Industries in and around Jamshedpur- especially in Adityapur Industrial Area (AIA) house auto ancillaries – are facing a tough time by series of the block ends in Tata Motors from past month because of a market slowdown. So much so that about 30-steel sector companies were on the brink of closing down while about a dozen hit their shutters from Thursday.
Hit with the slowdown in the auto sector, Tata Motors has gone for block closure for the 4th time since last month this time from Thursday to Sat, besides Sunday being a holiday. The company has also opted for the division of 12 days (asked to sit in the house) for over 1000 Y-6 (temporary) workers.
Permanent workers will rejoin duty on Aug-5 whereas Y-6 workers have been asked to rejoin on Aug -12.
Tata Motors had to get a series of the block ends due to slow market demands. There was production for only 15-days per month for the last 2-months. Union sources told the company has orders for only a week’s production in Aug. This has appeared in limited work in about 1000 auto-ancillaries reliant on Tata Motors in AIA.
On the other hand, the ‘exorbitant’ power rate hike has hit the steel sectors with induction furnaces – where power is an essential raw material – resulting in the closing of about 30 companies. Over a dozen, so companies have started downing shutters from Thursday.
‘Recession in the auto sector is nothing new…It comes every 2-3years. I joined Tata Motors Plant Head today, who stated that the company strength has to take another block end of 3-4 days after which things would normalise. We assume things to be back on track after Sep. The company has got 40% fewer orders for its vehicles this July compared to the corresponding month last year. Some of our companies are working in a limited space while some have opted for support work,’ Inder Agrawal, president, Aditaypur Small – Industries Association (ASIA), told HT today.