T. Murrali

Chennai, Nov. 4 Ashok Leyland is planning to reduce monthly production target for November to 1,500 units from the average of 6,800 units it clocked each month in the first six months of this fiscal. In November, the company will also work fewer days to match with the production schedule.

Sources close to the development told Business Line that the company would have negotiations with Employees Union and arrive at a wage package for the non-working days (other than scheduled holidays).

Members of the Ashok Leyland Employees Union today met the Union President, Mr R. Kuchelan, in this regard. However, with the demand dropping, cut in work days seems inevitable, sources said. Mr Kuchelan is expected to meet the management on Wednesday and to discuss the reduction in number working days. The meeting would also discuss the issue of wages during the lay-off period.

Usually, wages for the non working days are 50 per cent of the basic and dearness allowance, but other allowances would continue.

However, this time it would be different, sources said, because the production cut is going to be much steeper, by nearly 80 per cent. Since the production is cut so drastically, it would be difficult for the company to pay even 50 per cent of the wages, sources said.

In 2007-08, the company manufactured 84,006 units. In April-September 2008, it produced 41,233 units against 39,787 units produced during the same period a year ago, but the higher production has resulted in inventory build up.

© Copyright 2000 - 2009 The Hindu Business Line