[The Indian
auto industry has grown rapidly in recent years as the economy and consumer
spending have taken off. Few companies have benefited as much as Maruti, which
was once a joint venture between the Indian government and Suzuki of Japan. The
company is the dominant player in the biggest segment of the car market: small
hatchbacks that sell for as little as 250,000 rupees, about $4,500.]
By Vikas Bajaj and Sruthi
Gottipati
 |
Saurabh Das/Associated Press
Policemen gathered at the Maruti Suzuki factory in Manesar on
Thursday after workers rioted.
|
Portions of the car factory, owned by Maruti Suzuki, which
makes half of all cars sold in the country and is controlled by the Japanese
automaker, were burned during the fight, which started about 7 p.m. , the police said. Nearly 100 workers were arrested,
according to officials, and the wounded included two Japanese executives, the
company said.
This Maruti Suzuki factory in Manesar, about 50 kilometers,
or 30 miles, south of New
Delhi , has been the
scene of several industrial disputes since it opened five years ago, including a
strike at the end of last year that shut down the plant for several days. The
factory was part of a big expansion for Suzuki, which gets more than a quarter
of its revenue from India .
Strikes and violent protests have marred operations at
several Indian car, motorcycle and auto-part companies in recent years and a
couple of the clashes have resulted in deaths. Workers have complained that
their wages have not kept up with the country’s high inflation even as their
employers have enjoyed rising sales and profits. Another big source of tension
has been the increasing use of temporary contract workers to skirt Indian labor
laws that make it nearly impossible to fire permanent employees during
downturns.
The company and its labor unions provided very different
accounts of how the dispute started on Wednesday amid continuing negotiations
over wages. The union has said a supervisor insulted and demeaned a worker who
is of the Dalit caste, formerly known as the untouchables, and when that
employee protested, he was suspended.
When the union tried to intervene, the company called in
“hundreds of bouncers on its payroll to attack the workers,” Ram Meher, the
president of the Maruti Suzuki Workers Union, said in a statement provided to
the Indian news media.
But Maruti Suzuki said in its statement that the fight
began “with a worker beating up a supervisor on the shop floor.” The union,
Maruti argues, demanded that no disciplinary action be taken against the
employee. Workers then blocked managers from leaving, ransacked offices and set
fire to parts of the factory.
A spokesman for Suzuki in Japan , Ei Mochizuki, added that tensions had been running high
because government labor officials had refused to recognize the workers’ union
and the company had declined to take back workers fired during a strike last
year.
Mr. Mochizuki identified the employee who died as a human
resources officer. A doctor at the General Hospital of Gurgaon said the man’s
body was badly burned.
The police and government labor officials Thursday backed
the company’s story, describing the protest as a “conspiracy” and promising to
arrest workers and union leaders who they said were in hiding. Mr. Meher and
other union officials could not reached Thursday and their cellphones were
turned off.
The Indian auto industry has grown rapidly in recent years
as the economy and consumer spending have taken off. Few companies have
benefited as much as Maruti, which was once a joint venture between the Indian
government and Suzuki of Japan. The company is the dominant player in the
biggest segment of the car market: small hatchbacks that sell for as little as
250,000 rupees, about $4,500.
But workers have complained about harsh working conditions
at the factory and the company’s practice of hiring most of its workers on
temporary contracts. Those hired in such a way are paid a fraction of the
salaries permanent employees earn — 7,000 rupees per month, compared with
18,000 rupees a month for permanent workers. Contract workers can also be fired
more easily.
Company executives deny abusive conditions and have said
they hired entry-level workers on contracts and made them permanent as they
gained more experience. The executives have also accused politically affiliated
national unions of instigating protests.
The strike last year ended after the government of Haryana State
The company’s troubled relationship with workers in Manesar
suggests that it has had difficulty managing its growing operation. The company
has had far better relations with workers at its first and primary factory in
nearby Gurgaon.
Workers have said that one source of tension has been that
more than two-thirds of the workers at Manesar are on temporary contracts,
while the majority of the workers at the Gurgaon facility are permanent
employees. The company has offered slightly different numbers but acknowledged
that a majority of its Manesar workers were temporary employees.
In an interview in October, the chairman of Maruti Suzuki
suggested that the employees at the Manesar plant, which can churn out 550,000
cars a year, protested more because they are more inexperienced than workers in
Gurgaon, which can produce 900,000 cars annually.
“The operating conditions in both plants were the same,”
Maruti’s chairman, R.C. Bhargava, said. “But the Gurgaon people have had long
years to adjust to these conditions and to understand why and what they are.
These guys in Manesar have been recruited in the last two years, three years at
best. Some of them have been there even less than that; some are just
trainees.”
The troubles come at a challenging time for Maruti Suzuki,
which has seen sales slip as the Indian government eliminates subsidies on
gasoline but maintains them on diesel fuel. Although Maruti Suzuki also
produces diesel cars, it has the capacity to produce more gas-powered vehicles.
On Thursday, shares of the company closed down nearly 9
percent in Mumbai as investors worried about the company’s ability to recover
from the protest. The company said it had suspended car production at its
Manesar plant, which is being guarded by the police, and could not say whether
the factory would be able to resume work on Friday.
Sruthi Gottipati reported from New Delhi Tokyo New Delhi
