Due to slowdown in Auto industry, Tata Motors is considering rolling out a voluntary retirement scheme. The scheme will be offered to employees of different departments, across its businesses of passenger and commercial vehicles.
According to mint reports, “This year, Tata Motors’ employee cost-cutting plans are more aggressive than the previous times. Besides removing surplus staff at JLR in recent months, the company is now seeking voluntary retirements from more than 1,600 people across all locations and hierarchies.”
The package will be available for over 1,600 permanent employees in its fold — especially from engineering operations. Earlier in 2019, Hero MotoCorp Ltd, Ashok Leyland Ltd and Toyota Kirloskar Motors Pvt. Ltd that have introduced similar schemes.
Tata Motors has been trying to reduce its employee cost over the last few years and in 2017 had launched a similar offer, but most of the permanent employees stayed away from the severance package.
According to reports, the company’s employee cost as a percentage of net sales during the September quarter swelled to 10.7% from 5.9% in the year earlier. During the quarter, Tata Motors’ stand-alone net sales fell 44% from a year earlier, while it plunged to a net loss of Rs. 281.97 crore from a year-earlier profit of Rs. 109.14 crore.
