Toyota Unit Shuts 2 Factories in India

http://www.nytimes.com/2014/03/18/business/international/toyota-unit-shuts-2-factories-in-india.html

Version 0 of 1.

NEW DELHI — The Indian unit of Toyota shut down its two factories near Bangalore on Monday in response to a labor dispute over wages that has lasted for 10 months.

In a statement released Sunday, the unit, Toyota Kirloskar Motor, said the government of Karnataka State had held seven meetings with the factories’ workers and the company. The statement also said employees had deliberately stopped the production line and threatened and abused supervisors, adversely affecting production for the past 25 days.

“The company is left with no other option but to declare a lockout of the premises to ensure the safety of its workers and management personnel,” the statement said.

Disagreements between management and workers over wages and labor conditions have plagued several foreign car companies in India in recent years. In 2012, one person was killed and more than 70 injured during a struggle over wages between workers and managers at a Maruti Suzuki factory near New Delhi. The company said the event was a case of mob violence and aggression from workers, while the labor union said it was the company that was the aggressor.

The closure of the two Toyota factories will result in lost production of 700 units a day. In recent statements, senior company officials noted a decline in monthly sales compared to previous years, calling the market “sluggish.”

Company representatives were not available for immediate comment on Monday, which was a national holiday in India.