Tata Motors has indicated it may undertake more block closures at its Jamshedpur, Jharkhand, commercial vehicle plant in the remaining months of current fiscal year, reports the Press Trust of India, citing a company official. "We cannot pile inventory at our premises, nor is the prevailing situation under our control as it depends on the economic condition of the country," said plant head A B Lall, adding: "We have no option but to adjust our production with demand." The executive said the company is producing 200-250 vehicles per day, compared with normal daily production levels of 400 units.
Significance: The largest commercial vehicle (CV) manufacturer in India, Tata Motors is suffering in the current economic slowdown. The company has already undertaken block closures at the Jamshedpur plant four times this fiscal year, most recently in September. The automaker's CV sales dropped 19% year on year (y/y) during the first 10 months of the year, much higher than the 13.5% y/y drop seen in the overall CV market in the same timeframe. The majority of Tata's CV sales come from medium and heavy trucks, which have seen a sharper drop in sales volumes. The situation has now started to affect truck-makers' profitability, and while Tata's Jaguar and Land Rover luxury brands are helping the manufacturer to report higher financial numbers, other industry players such as Ashok Leyland have started to make losses.
