Future of Ford’s 2,600 employees at stake

Employees say there has been no production in the plant over the last week

Ford cars are assembled at a plant of Ford India in Chengalpattu in the outskirts of southern city of Chennai March 5, 2012. Ford Motor Co will focus on small, low-cost cars in India to make the country a manufacturing hub for Africa and the Asia-Pacific region, the head of its Indian operations said, as it races to catch up with global rivals in the fast-growing market. Picture taken March 5, 2012. To match interview FORD-INDIA/ REUTERS/Babu (INDIA - Tags: TRANSPORT BUSINESS)

Car maker Ford’s decision to wind down its engine and vehicle assembling plant at Maraimalai Nagar near Chennai, by the second quarter of 2022, will put the lives of over 2,600 employees in Tamil Nadu at stake. While some employees said they have been anticipating the move for months, many were in for a rude shock on Thursday.

One of the senior-most employees, who is also part of the union, said they had been informed about the closure and told that talks on settlements would commence in the coming days. “We expected that they would cut down on production. Closing the plant is something we never saw coming,” he said.

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The company, in a message to its employees, said it would work closely with employees, unions, dealers and suppliers to care for those directly impacted.

Another employee said there had been no production in the plant this last week. “We were told that there is a raw material shortage. Many workers are now at home. Only after hearing the news, we are realising this was a strategy,” he said.

Employees whom

The Hindu spoke to said they had no information on when production would resume, and when they would have to report to work.

They said the company had said that it would announce the joining date in a day or two. Many were upset that the company had recently given them an average annual hike of ₹8,800, and now the news had come as a spoiler.

S. Kannan, deputy general secretary, Centre of Indian Trade Unions (CITU), Tamil Nadu, said workers had recently signed revised wage agreements for only a year, and at the time, the CITU had indicated that something was not right. “We asked them why the agreement was only for a year and not for three,” he said. “And now, even their final settlement will not be that big,” he added.

Several thousands of indirect workers too will be taking a beating because of the shutdown, but their actual number is not available. Workers, many of them in their mid-40s, are also worried that with the pandemic, job opportunities in the automobile hub has shrunk.

The car maker first stepped into Tamil Nadu in 1996, and till date, has invested over ₹5,161.4 crore in the State.

MSMEs and suppliers

Many MSMEs in the Irungattukottai region, which supply raw materials and spare parts to Ford, have expressed concerns about the closure of the plant. They said this would create a small dent in their businesses. “It is too early to quantify its impact, but some firms will certainly suffer,” said the proprietor of a firm in the region.

K.E. Raghunathan, convener, Consortium of Indian Associations, said it was not Ford that was shutting down, but over 4,000 SMEs that were closing operations.

“The worst that was anticipated has happened. The auto sector has expressed its concerns in the last four years on many occasions, but no one acknowledged them,” he said.

The MSME sector is predominantly involved in the production of car parts, such as upholstery, leather, dashboards, clutches, brakes, gearboxes, tyres and handles, Mr. Raghunathan said.