Maruti Suzuki India

Limited Industrial-By Group 8

Relations

Prince | Prashant |Jim | Ravi | Renu | Shweta |

Tijo

Q. Explore beyond the

timeframe when the case
was written and present to
the class the events
thereafter

Entrance of Mediator into issue

Formation of Joint action committee to support the strike
by AITUC, HMS, UTUC, INTUC
AITUC became the main spokesperson of the strike
On 9th of June, this action committee mobilized workers
of 50 to 60 factories in Gurgaon around 1000 to 2000
union members gathered in front of the gates
10th of June, due to increasing pressure on striking
workers, they were pushed further into arms of the main
unions

Consequenc
es
Haryana Labor Commissioner Satwanti Ahlawat declared
the governments support for the company, saying:
Whatever the bond that the management (MSI) is
asking its workers to sign is as per rule and workers will
have to sign it.
Isolated by the AITUC bureaucracy and under pressure
from the employers, over 100 locked-out workers have
signed the good conduct bond.
October 13, 2011 Haryana governmenton declared
strike by workers at Maruti-Suzuki's Manesar plant as
illegal.

Consequenc
es
Workers still continued to demand that the management
take back all suspended and casual employees
Suzuki India Ltd. has incurred a revenue loss of 15 billion
rupees ($306.7 million) since Aug. 29 due to labor woes
at one of its factories that have severely impacted
vehicle output at the country's largest car maker by
sales.

Financial implications for Maruti after Manesar

Lockout:

Instant Loss of US$70 million on lock out day due to fall in market
shares
Thereafter daily loss of US$ 13.5 million due to production halt till lock
out
Share of parent venture Suzuki motor corp. also fell by 5.7% on 20
july (lowest in more than three years)
MSILs market value reduces by US$570 million (Biggest single day
drop in last 2 years)
Production shortfall of around 83,000 cars (1400x59)
Overall Maruti sales fell nearly by 11 %

Important changes done after Manesar lockout:

Termination of 546 permanent and 1800 contract workers
Reopened the plant with 300 permanent workers
Minimal wage difference between permanent and contract workers
led to removal of contractual work system
Hiring of new workers through company HR instead of a contractor

Q4. What are the major

learnings from the case?

- By Group 8

Thank You