[androdev]

So I am guessing new corolla altis delvery/launch will be affected?

[joybhowmik]

Originally Posted by androdev

So I am guessing new corolla altis delvery/launch will be affected?

Yes. Besides, the dealers would already have cleared out old stocks to make way for the new models. So wait time will be high if looking for a new Toyota car.

I think we will also see delays in parts arrivals.

Would Toyota do the smart thing and source parts from neighboring countries for models such as Innova / corolla ?

[ashphil]

Toyota has been long enough in the Indian market to get accustomed to our culture and labor laws. So if they have not been able to negotiate a settlement with the labor force then it must be because the demands made by the labor force are beyond what they can afford presently. Labour unions normally look at what they can squeeze out of the management today rather than take a long term view of how we can grow together and avail of benefits in the future.
These kind of lockouts especially by well known companies such as Toyota spell bad news for our economic growth. It will discourage the setting of new factories and retard new foreign investments. The Government of India needs to play a more active role in the prevention of such situations

[Traveller Nayak]

Originally Posted by joybhowmik

I think we will also see delays in parts arrivals.

Would Toyota do the smart thing and source parts from neighboring countries for models such as Innova / corolla ?

Eventually (and hopefully soon) this will be resolved. The point you raise about parts could become a pain point for customers. God forbid if someone needs a critical part which is not readily available. Toyota must put a contingency plan in place for all models it is selling in India.

[lurker]

Usually it is in weak state govts where governance is poor that such lockouts are seen. Usually no unions messes around when a strongman is in power, case in point is the present situation in TN, WB, GJ etc. Haryana & KA are believed to be soft states in governance terms.

[Hiteshs77]

I am looking at the news flow on this issue. It seems the workers wanted a monthly pay hike of 8,000 a month (a very high number to take a negotiating position). With the mediation of government, Toyota offered something like 3000 a month but union wants to squeeze 4000 a month now.

Not to sound like a capitalist, but in a dull auto market, to seek double digit hikes is way unacceptable esp. with the Indian labor laws when you cannot lay-off manpower even if you have improved productivity and thus pay the residual a higher compensation.

The unions need to partner managements to increase the size of the pie rather than squeeze from already reducing pool.

[greenhorn]

I am looking at the news flow on this issue. It seems the workers wanted a monthly pay hike of 8,000 a month (a very high number to take a negotiating position). With the mediation of government, Toyota offered something like 3000 a month but union wants to squeeze 4000 a month now.

I thought this was par for the course in IR. Generally the unions start with a sky high list of demands (probably to compensate for the fact that the IR folks from the company are going to push back hard ). No different from your traditional street bargaining. 4K sounds about right for a realistic target, and 3k would have been decent to settle for. Looks like both parties have decided to play hardball. Let's see who blinks

[greenhorn]

http://www.thehindu.com/business/Ind...cle5808921.ece

It seems the hike is not the reason. Toyota wants to put a handle on worker indiscipline. Can any folks from that region comment on how the blue collar workforce is there generally?

[Contrapunto]

Originally Posted by greenhorn

http://www.thehindu.com/business/Ind...cle5808921.ece

It seems the hike is not the reason. Toyota wants to put a handle on worker indiscipline. Can any folks from that region comment on how the blue collar workforce is there generally?

Yes. That does seem to be the ostensible reason. Has the union gained more militant members and office bearers in the past? Or is there a kernel of genuine grievance. It would be interesting to analyze the pace of price changes in TKM cars (which, we all know, more than amply kept pace with retail and input cost inflation) and the rate of change of workers' compensation.

Somewhere I remember reading that the last wage negotiation was in 2006. Let's remember that Innova G was around 10 L then (now 17 L)- similar trends exist in both Corolla and the Camry. So Toyota (indeed all carmakers) have got compensated for every element of input costs, but probably want to hold the line on labor cost in the "cost mix", just because it thinks it can. Interesting.

Steel/ aluminum prices go up, and so does car prices, but they have also come down the past 3-4 years as the world economy cooled, but car prices? . Ditto for the Rupee depreciation, we heard loud wails from the auto industry, but the Rupee has risen back, covering most of its losses. Car prices, those were increased because of prohibitive cost of imports, have they come down even 10 basis points? Nope .

Disclaimer, I am more a rightist, than a leftist, and definitely neither an employee, or anyway related to either party in the dispute. but I AM a keen student of business but this one seems to be a mercantile dispute over wages that that's being couched as a disciplinary issue. My advice, for whatever it is worth to the workers, would be to avoid even a semblance of violence at ANY cost, hold tight and keep explaining their "mercantile argument" for higher wages in a way that the broader world will understand. A rough estimate of how much of the 17 L a customer pays for an Innova goes towards paying salaries, may be a good starting point. I am getting a very funny feeling it will be figure that surprises us all.

Way ahead for Toyota? A new plant with a very, very high level of automation- complete with robotized lines and paint shops would be a good place to start. Of course, my wild guess is that the old world models like the Etios & pre-historic ones like Innova may not lend itself well to robotized assembly.

RAV4 and Sienna- anyone?

[Vid6639]

Toyota Kirloskar Motor's Statement on Lockout - 20th March 2014:

The Company has submitted to the Deputy Labour Commissioner that considering the inclination and in the interest of majority law abiding team members, we have decided to lift the lock out implemented vide notice dated March 16, 2014.

Consequent to our above decision, the team members are welcome to resume work with effect from Monday, March 24, 2014 after signing a simple undertaking on good conduct.

We wish to thank the Govt. of Karnataka for their valuable advice concerning our operation.

[Hiteshs77]

Finally better sense prevailed. This round to management. The workers need to sign a good conduct undertaking and can join back. Kudos to Karnataka government as well.

[Contrapunto]

Originally Posted by Vid6639

Toyota Kirloskar Motor's Statement on Lockout - 20th March 2014:

The core issue (pay) remain unresolved. The union has not signed a "good conduct" undertaking as well. I wonder what the lockout achieved, other than to serve as a gambit on the wage negotiations chessboard.


Best of luck to both parties.

[allinbalance]

Originally Posted by Contrapunto

To my knowledge, there are 2 aspects to these labour strifes.

The first one, of course, is the culture. A large population in the hinterlands, having come up through our schooling / educational system (often in the hinterlands) find it difficult to imbibe the consistency-obsessed, quality-obsessed work culture. I mean, everybody loves it as customers , but living it is another story altogether. And unfortunately that is the key differentiator- what other reason is there between the wide quality difference between a Japanese car-vs. aamchi Tata vs. Indian assembly of German cars like the Skodas? So, some tension there is inevitable. How managements manage it is the question.

The second cause, of course, is money and compensation. Different companies have different compensation "philosophies", some more exploitative than the other. At its root, of course, is the desire of most managements to keep fixed pay low, and negotiation only on the variable pay like bonuses and productivity linked incentives. Workers, for obvious reasons, want an increase in their fixed pay more than anything else. This has caused labour issues around the world, not just in India (China, S Korea, Europe and of course, in US as well). Its something the company management has to figure out for their own good.

@Contrapunto I agree with your second point completely while I don't with your first.

The reasons are as follows:

a) Japanese emphasis on productivity and utilization goes to manic extent - we all know that - but even relatively small town/rural industrial workers all learn very fast. Almost all of the auto companies - TATA, Mahindra et all - follow many Japanese optimization techniques and actually are also pretty obsessed with them.

b) Culture has little to do with these kinds of issues at that level. I run a Chinese multinational companies factory and Supply Chain operations in India and I can share with you from personal experience that apart from standardization and rigid rules, there is NOTHING different from Far East MNCs or US ones. They all want the maximum bang for their buck - THEIR WAY.

Well, unfortunately, your average industrial worker from the nearest Hobli (village/community) wants more fixed cash for his hours!! He had rising costs - which hit the hardest at the lower end of the organized labor force - always.

This incident is similar to the older Honda incident, only Honda IR team was more responsive and they handled it better.

[Aditya]

The management of Toyota Kirloskar Motor has ended the lockout at the company's two manufacturing facilities at Bidadi, near Bangalore, Karnataka. The company has asked its workers to return to work after signing an undertaking on good conduct. The workers, however, have refused to sign the undertaking.

About 500 workers showed up outside the plants to work in the 6.00 am shift this morning. However, none of them entered the plants. The undertaking of good conduct is seen as being against the workers' interests and welfare by the union. The union has also asked to reinstate the 17 workers, who were suspended over misconduct and indiscipline.

Link to Team-BHP News Article

[joybhowmik]

All's not so well, that ends well.
Simmering discontent and distrust may overflow into yet another industrial action.
Declaration of lockout may have prevented loss of plant and machinery in this round, but what if the discontent boils over and the Bidadi plant witnesses the kind of action seen at MSIL Gurgaon?
This is not a permanent solution - by any stretch of the imagination.