Ashok Leyland to absorb production holidays at Chennai plant

Hit hard by a whopping 50% decline in its August domestic sales, coupled with no sign of an early recovery in demand, Hinduja group flagship Ashok Leyland (ALL) has once again decided to absorb production holidays at its Ennore plant (the mother plant) in Chennai.

After absorbing August 16, 17, 24, 27 and 31 (and August 26 as the 6th day non-working day) as non-working days earlier, the company has decided to go for more production holidays at the plant.

In a communication to employees on Thursday, the company said due to continuing sluggishness and contraction in the commercial vehicle market, the need has arisen to continue the corrective actions to safeguard the interest of the company. Hence, it has been decided to declare September 6, 7, 10, 11 as non-working days and September 9 as the 6th day non-working day.

Wages payable for the non-working days declared on September 6, 7, 10, 11 will be decided after discussion with the Ashok Leyland Employees Union. For the non-working of 6th day on September 9, employees will be paid sixth day compensation (SDC) in September.

When contacted, an official of the workers union confirmed the developments and said they would be working only two days next week. The company has reported a 50% drop in August domestic sales to 8,296, compared with 16,628 units sold in same month last year. While LCV saw a decline of 12% to 3,711 units (4,208 units), the value segment –

M&HCV – witnessed a whopping 63% fall in its August sales to 4,585 units, compared with 12,420 units in August 2018. Including exports, total vehicles sales for August declined 47% to 9,231 units, against 17,386 units sold in August 2018.

On the union’s demand on bonus, the union official said talks are at the final stage and the decision will be made known in next few days. While the union has been asking for 7%, the management, given the ongoing crisis, is stick to offer only 5%. Workers had earlier gone for a sit-in dharna, objecting to the company’s adamant attitude on the bonus demand.

Ashok Leyland Limited