Employees of TVS Motor Company, will be taking salary cuts, most of them voluntarily, from May to October, 2020. While the junior executives will take a cut of five per cent, the senior management will take a cut of 15 to 20 per cent. This is a temporary move for a period of six months only, to help tide over the economic crisis due to the pandemic. The employees had received full salaries for the month of April.
The Company that manufactures Apache motorcycles, has been facing the challenge of maintaining sufficient liquidity and free cash flow, with sales dipping in the auto space since last year. There has been a 51 per cent drop in sales in passenger cars and 88 per cent drop in the sale of commercial vehicles. The lockdown has impacted the sale of TVS’ two-wheelers and three-wheelers, with domestic sales reported to have fallen by over 60 per cent in March.
The Company has resumed operations at its plants in Hosur, Tamil Nadu, Mysuru, Karnataka and Nalagarh, Himachal Pradesh, after a long break of over 40 days. The Company also operates a unit in Karawang, Indonesia.
CarDekho the automobile portal has also laid off employees and cut salaries to help stay afloat and cut costs. The staff will take 12 per cent to 15 per cent salary cut. It is reported that about 200 employees has been asked to leave. However, the numbers are yet to be officially confirmed.