The Hindu Business Line : Bajaj Auto on cost-cutting drive

DECLINING demand for scooters is forcing two-wheeler major Bajaj Auto to not only cut production but also undertake cost-cutting measures, including job cuts.

Bajaj Auto's Vice-Chairman, Mr Madhur Bajaj, told reporters that the drop in demand had compelled the company to move to a five-day week at its scooter plant in Pune.

In addition, despite a series of voluntary retirement schemes, Bajaj Auto still has a surplus of 1,000 workers at its Pune plant, who are getting full wages.

"We have been trying to reduce these jobs but have not met with much success so far," Mr Bajaj said.

These workers had refused to take VRS, due to the reduced feasibility of doing so in light of the declining interest rates. The firm, at present, has about 12,000 permanent workers and staff on its rolls, out of which 8,000 are workers.

Also, in a bid to increase its market share in the scooter market, Bajaj Auto is planning to launch new models of geared as well as ungeared scooters this fiscal.

Mr Bajaj said scooters would remain a major focus area for the company. The scooter market had seen a revival in the last fiscal, with sales growing by 7.2 per cent to 885,038 units.

However, the revival was driven largely by the sale of ungeared scooters by Honda Motorcycles and Scooters India.

Mr Bajaj remained optimistic about the growing motorcycle sales and said the company expected to sell about 1.2 million bikes in the current fiscal.

Another focus area for the company would be the exports of three-wheelers and two wheelers, with Latin America emerging as an important destination.

Bajaj Auto already has an assembly line for making both two and three wheelers in Brazil.

More Stories on : Outlook | Two/Three Wheelers

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Bokaro Steel Plant plans Rs 1,950-cr expansion

`Round the Corner' cuisine offers Kerala, Chettinad delicacies

TV software co enters animation

PSL completes IOC project before schedule

LCM: The new addition to management jargon

ICAI okays plan to allow CAs to fix fees per assignment

Disputed tax burden rising for India Inc — But stock markets remain unperturbed

HPCL may announce VRS in June/July

`Steel bull run likely to continue till 2010'

Bajaj Auto on cost-cutting drive