Growing confrontation between capital and labour in the Indian auto sector

The Indian automobile industry is seething with confrontations between the capitalists and workers. The contradictions are intense as the workers in the sector, numbering about 2 crores, across the country, face insecurity of job, layoffs and early retirement as automakers prune their workforce.

The Indian automobile industry is seething with confrontations between the capitalists and workers. The contradictions are intense as the workers in the sector, numbering about 2 crores, across the country, face insecurity of job, layoffs and early retirement as automakers prune their workforce.

The automobile sector recorded phenomenal growth in the early years of the previous decade, with the implementation of the bourgeoisie's programme of liberalisation. Many global automobile manufacturers like Ford, General Motors, Toyota, Honda, Hyundai, Volkswagen etc. entered the Indian market to set up manufacturing facilities within the country. With this influx, the industry emerged as the sixth largest producer in the world. The period of rapid growth of the industry was between 2003-04 and 2006-07. Likewise, during the year 2006-07, the auto component industry continued its high growth path and emerged as one of the fastest growing sector in Indian engineering industry. Exports of passenger vehicles multiplied ten times in the same period, while exports of three wheelers and commercial vehicles registered an even sharper increase.  The global recession and the decline in demand has hurt the industry in the years following.

Currently, the management of the automobile (passenger and commercial vehicles), auto-components and other ancillary manufacturers are facing one of the steepest decline in domestic and export sales and hence are cutting production. In order to enhance their profit margins, they are squeezing the workers.  As a rule, automobile companies are drawing more than 60% of their labour force from contract workers, who are paid less than one-third the wages of regular workers, and can be dismissed at will. Since the events at Maruti's Manesar plant in 2011, there has been some decline in the percentage of contract to total workers, but companies, like Maruti itself, continue to use “trainee-workers” who do not enjoy the same rights as regular or permanent workers. According to official reports (according to the Society of Indian Automobile Manufacturers), 1.5-2.0 lakh jobs have been lost in the auto sector just in the previous year.

The workers in the Indian auto sector are agitating for several demands – chiefly, the right to unionise, the right to permanent employment conditions, higher increments, security against layoffs, etc. They are fighting for a secure and decent livelihood. “The basic point is that it is impossible to survive on a factory salary. These companies eat away at your youth," says a 31-year-old trainee at Shriram Piston who gets Rs 6,000 a month in hand. "You join as a trainee, they say you will become permanent in six months, then one year, then two… and then, one day, you are too old and must remain a contract worker for life.” This would mean no pension or any other retirement benefits.

On 3rd May, the workers at Shriram Pistons and Rings Ltd., located in the Pathredi Industrial Area on the Haryana-Rajasthan border, who had occupied the factory following a tool-down strike, were evicted by a 200-strong police force which used tear gas, water canons, batons and even live ammunition against the workers. As a result, 79 workers had to be hospitalised while 21 were arrested (reported by Business Standard,
May 05, 2014).

Of late, workers of several companies like Napino Auto and Electronics, Autofit India, Asti Electronics and Baxter India have organised sudden work stoppages that have sometimes turned into prolonged occupations. This March, workers at Napino coordinated a 10-day worker occupation across three separate plants. The management shut down the canteen at Napino, but women workers smuggled food into the plant for everyone.

Young workers are increasingly forcing direct confrontations with management when their demands  are ignored. Their experience shows that when they sit in dharnas, the management declares a lockout. brings in contract workers from outside and keeps the production growing. Therefore, they are downing tools, and occupying the factory floor to effectively bring production to a standstill. In response, the management is using police force to evict the workers sharpening the confrontation.

The young workers are fighting militantly for their right to form unions  but the management takes swift action against any such move by suspending the leaders who are at the head of such actions. By law, companies cannot stop the creation of a union; management responds by suspending the leaders, the workers who put their names on the union application.

The capitalist-labour conflicts are bound to intensify as the owners of automobile, auto-components and auto-ancillaries plants desperately respond to preserve their margins in the face of declining demand. Across the board, the capitalists are demanding “flexible” labour laws that will permit them to hire and fire their workforce as it suits their production plans. Workers, for their part, are strengthening their resistance to these anti-worker moves.

Recent cases of labour issues at some of the automobile companies

BAJAJ AUTO

April 2014: Chakan plant workers threaten to go on a strike from April 28, if their demand for 500 of the firm's shares for each employee at Rs 1 apiece and half the amount Bajaj spends on CSR activities is not allocated to their children's education. Rajiv Bajaj calls the demands “preposterous” and refuses to consider the demands.

TOYOTA KIRLOSKAR

Mar 2014: Workers at Toyota Kirloskar Motor (TKM) Pvt. Ltd’s two plants at Bidadi near Bangalore refused to enter the factory, on being demanded to sign an undertaking of ‘good conduct’  by company managers after the lifting of a week-long lockout. Their demand for more holidays, company housing and pay raise of up to Rs 4,000 a month had in the first place provoked a lock-out by the company.

GENERAL MOTORS INDIA

Jan 2014: After the firm gave fresh appointment letters to only a few workers at its plant in Gujarat, contract workers protest, demanding parity in wages; matter settled after the firm works out a new plan

BOSCH INDIA

Nov 2013: Bosch (India) Ltd's main production unit near Bangalore is hit by labour unrest, as the employees' union "resorts to a tool-down strike following a dispute over a gate pass for an employee; the issue is resolved later.

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