Faces of the automobile slowdown

The shutters of the Barathi Women Enterprises remain shut on a weekday afternoon. The work has stopped after Diwali, which ended last week, as they have not been receiving orders lately.

L. Reeta, who lives next to the plant, is the Secretary of Barathi Women Enterprises, a small initiative run by 13-women who make different kinds of pickles. “We used to make 50 kgs of pickle a day, now we don’t even make 50 kgs a month,” she says.

The enterprise was set up by Hyundai Motors India Limited (HMIL) under the Dream Village Project, a Corporate social responsibility (CSR) initiative in December 2016.

The production of pickle in Sriperumbudur, Kancheepuram, walking distance from the Hyundai car manufacturing plant, has gone down in the past few months, adds Reeta.

Sriperumbudur is home to two major automobile manufacturing plants in India, Hyundai and Ford. According to The Hindu, Chennai produces about three cars every minute and one commercial vehicle every 90 seconds, Tamil Nadu accounted for 45 per cent of the country’s motor vehicles and car exports in 2017-2018.

However, the automobile industry is experiencing a severe slowdown in the past few months. According to a report by SIAM (Society of Indian Automobile Manufacturers), passenger vehicle sales has slumped by more than 23.7% in September.

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HMIL witnessed a sharp decrease in sales of 3.8 per cent in the Diwali month of October in contrast to 2018. Ford India, also housed in Chennai, recorded a decrease of 22.4 per cent sales in the past month, according to the company records.

Ashok Leyland, the truck and heavy automobile makers, have resorted to non-working days – about 55 across all plants. The automobile companies have not announced any lay-offs, as of yet.

Vinucharan Vijayaraj, Assistant Manager of Production Department, Ashok Leyland, Sriperumbudur, said unclear BS-6 norms by the Government, overproduction for the inventory and low sales rate were the reasons for the slowdown. The company is now forced to change the production plan, which was due in January-March, he added.

Other challenges include loss of jobs, non-production days and even the Diwali offers have failed to attract customers. The workforce in the SIPCOT Industrial Park is dominated by migrant workers. However, the local workers have alleged that the employers have favoured migrants.

The effect of the slowdown has reached the spare parts makers, who are the second arm to the smooth running of the industry. The Trade union members blame the government and abrupt policy changes that have disastrously reduced the demand in the market.

“The government has allowed the automobile manufacturers such as Tata Motors and Maruti Suzuki to set up their own servicing facility near the factory. The car owners have to bear huge charges for the service compared to low charges in Pudupet” said Haroon Rasheed, President of Motor Vehicle Spare Parts Welfare Association, Pudupet.

The cash crunch because of demonetisation and increase in the tax rates of spare parts (5 to 18 per cent by the introduction of GST) has played an important role in the economic slowdown, Rasheed added.

Kumar Srinivasan affected by the slowdown near the Hyundai Factory. SIPCOT Industrial Estate, Sriperumbudur

Kumar Srinivasan, a tempo travel owner of Jayalakshmi Enterprises from Triplicane, who ferries Hyundai executives (domestic and foreign) from the city to the factories in Sriperumbudur and Oragadam has faced an acute problem.

His monthly salary went down from Rs 35,000 to Rs 25,000 as the trips decreased by a half. He has pledged his wife’s jewellery to pay off debts. “I am struggling to pay for my daughter’s education,” says Kumar.

Chandrakumar Sen, a lorry driver from Jharkhand, made eight trips monthly from Chennai to Bangalore for HMIL supplying nuts and bolts. Now the trips have reduced to four.

The lorry drivers are worse hit as they are hired on a contract basis and are not paid regularly. In an unusual case, Praveen Kumar Yadav, a lorry driver hailing from Nepal, was found near HMIL plant covered in blood, his face and hands were injured badly after he suffered a fall. “I do not have the money for treatment and I won’t get salary for another 10-15 days,” he said. The nearest government hospital is in Poonamalee, 30 km away.

Reeta has managed to keep the pickle plant afloat for a while now. Vrutti, a Bangalore-based NGO with the help of HMIL had set up the enterprise in six months. The production had been smooth, it supported and empowered women’s livelihood, they made steady income until the machine, which was used to cut raw mangoes and lemons broke, and to their despair, the orders stopped coming too.

The CSR team of HMIL did not respond with a comment.

The women took odd jobs like housekeeping and gardening in nearby automobile plants after the production dropped. Interestingly, Reeta said Adyar Ananda Bhavan, a popular restaurant and sweet mart, also serves the pickle made by the enterprise. She said, “They have changed our name, Sri Krishna Pickle, and pasted their own brand on the pickle bottles”.

Christopher, who said he is a job agent, in Sriperumbudur informs potential candidates about vacancies in automobile and automotive companies. He claims that there are openings for contract jobs such as lighting, tyre-fitting, in top companies such as Hyundai, Ford, Ashok Leyland and Yamaha etc. Christopher charges Rs 1800 per person as a one-time payment and Aadhaar card for proof.

In a slump year, it is hard to see if the jobs that Christopher is claiming to hire for are real or not.


– The series of stories on Automobile sector slowdown have been reported and written by Group D of the ACJ Print batch of 2020. Group D consists of Phurpa Lhamo, Priyada K S, Rahul Manoj, Rituparna Palit, Rizvi Saif, Sayantan Guha, Sanchari Samanta, , Sameer Kulkarni, Sashwata Saha, and Shivanand S.