K. Giriprakash

Bangalore, Nov. 18

AUTO parts major Mico has said that the current strike at its Nashik plant will not hit the common rail project even as the company has "rightsized" its manpower and reduced the capacity at one of the divisions of its Naganathapura plant.

Mico has carried out a rationalisation of its spark plug division at the Naganathapura plant because of the falling sales of spark plugs. Mico-Bosch's Joint Managing Director, Mr M. Lakshminarayana, told Business Line that the company had resorted to rationalisation to keep up with the market forces. "We are certainly not getting out of this business. We are sizing it in such a way that it suites the customers' needs," he said.

The resources at the spark plug business division, which is part of the company's Naganathapura plant near Bangalore, has been rationalised through redeployment of manpower, sources in Mico said. The spark plug business has been suffering from falling demand because of longer life of the new types of the product and increase in import of spurious products into the market.

Mr Lakshminarayana, however, said that rationalisation of the company's divisions are part of an ongoing process to optimise the resources. Reduction in excess capacity has lead to major savings, sources said. Mico had earlier said the company could witness a decline in net profit from the 2004 level because of increase in investment for manufacture of common rail system and fall in demand for inline pumps.

Mr Lakshminarayana said the work at the Nashik plant, which makes injectors for CRDi system, will not be affected because of the strike. Nearly 3,000 workers have gone on strike since November 14 demanding better wages.

Mr Lakshminarayana said the wage negotiations are currently on with the workers' union. He said the company has sought increase in 10 per cent - 15 per cent increase in productivity from the workers. "We have sought a measured increase in productivity on a scientific basis," he said.

He said the workers at the Nashik plant are among the highest paid in that area.

(This article was published in the Business Line print edition dated November 19, 2005)
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