Dunlop mulls closure of Sahagunj unit

Mr Pawan Ruia, Chairman of the Ruia Group, is in two minds: Should he wind up the Sahagunj facility of Dunlop India in West Bengal or should he make fresh attempts to revive it? He is, however, sure that the company will continue with the Ambattur facility in Tamil Nadu.

The Dunlop brand is already in use by the group-controlled two- and three-wheeler tyre-makers Falcon Tyres (Mysore) and Monotona Tyres (Mumbai).

Acquired from the Jumbo Group (along with Falcon Tyres and Indian Tyre and Rubber at a total consideration of Rs 200 crore) in December 2005, neither of the Dunlop facilities had a smooth sail and had suffered at least one round of work stoppage each, during the last four years.

As things stand today, the Ambattur facility is operating at 15-20 tonnes a day, far below the rated capacity. “We could have stabilised production here but for the incident of sabotage by our own employees a few years back, allowing an outsider to take possession of part of the factory land and machinery. The incident had cost us precious one and a half years.”

The Sahagunj facility is open but has not been in production for nearly four months now. However, trade union sources confirm that the company is paying wages and salaries to 950 employees of the facility.

Law and order

“The law and order situation at Sahagunj area is appalling. There are regular incidents of infiltration and theft in our factory. Even the doors and windows of the staff quarters from our township area are being stolen. It was not in our estimation that the situation could be so bad here,” Mr. Ruia said at an informal news conference on March 29.

Union's views

“We are one decision (step) short of calling it quits (from Sahagunj)”. The apparent pessimism was however immediately countered by a clarification: “I am yet to accept the failure and who knows we may again strive for reviving it.”

Trade union sources, confirm that Mr Ruia had indeed expressed his desire to wind up the Sahagunj facility. “In a meeting with the trade unions and the PF trustees at the company headquarters in end February, Mr Ruia said that he had tried his level best to revive the facility but cannot go any further,” Mr Ranjit Niyogi president of the INTUC affiliated employees union told Business Line .

“However, we have insisted that he should pay up the workers' dues before he takes any such decision,” Mr Niyogi said. While admitting the incidences of theft, he blamed lack of action on the part of the company for the same.

Workers' dues

According to Mr Niyogi, Dunlop is yet to pay dues to 300-odd employees out of 1,400 opted for early retirement scheme. Dues of 210-odd retired employees were yet to be paid too. The trade unions have also accused the company of suspected mismanagement in provident fund corpus. “Based on our complaint the PF commissioner has sought clarifications from the company,” he added. Comments were not available from CITU affiliated union.

A company spokesperson, however, accused the trade unions of levelling “unfounded allegations”.

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