Maruti mulls shift from strike-hit India plant

MUMBAI: India's largest passenger car maker Maruti Suzuki India is considering moving production from a strike-hit factory to minimise losses, a company source told AFP on Thursday.

"It is an option we're looking at to reduce production losses but the cost, technology-shift and logistics are big issues," the source said.

Nearly 2,000 workers at the firm's plant in Manesar, in the northern state of Haryana, walked out on June 4 after the management refused to recognise a new union. But talks aimed at ending the strike are deadlocked.

A Maruti spokesman said the company had lost nearly $93 million since the start of the strike, with the walkout expected to hit the production of about 12,600 cars by Thursday night.

Bosses have said that the strike is illegal as no notice was given. Union leaders say they will not back down unless their demands are met.

The company source said the possible shift in production of cars like the Swift Dzire and the SX4 would be to the firm's other plant in Gurgaon, where production is unaffected.

Maruti produces 850,000 cars from Gurgaon and 350,000 from Manesar.

The strike comes as Maruti car sales grew at their slowest pace in nearly three years, with demand in India moderating due to rising input costs, fuel prices and costlier auto loans.

Senior political leaders in Haryana, including the chief minister, have been in talks with Maruti bosses to prevent the industrial action spreading, after workers in dozens of local factories pledged their support for the strikers.

The Press Trust of India news agency said workers in 65 factories in the Gurgaon-Manesar area would work without food on Friday and planned a two-hour stoppage on Monday.

Maruti wants the Manesar striking union to be non-political and come under one umbrella union, which would include Gurgaon, near the capital New Delhi, where the firm's second factory is located.

Copyright AFP (Agence France-Presse), 2011