Automotive industry grapples with supply chain challenges as it looks to restart factories

May 12, 2020 4:15 pm

The automotive industry is grappling with the issues of opening a countrywide distribution network and ensuring supply chain continuity between the designated red, orange and green zones as it mulls restoring production capacity at factories. Although the lockdown relaxations have kicked in for the industry to operate in many areas, companies especially with a retail front end will see how the last-mile link to the consumer becomes operational pan India. Once the manufacturing starts, demand pickup especially for big-ticket items like cars will be the other important variable, as what is manufactured will also have to be sold.

Naveen Soni, Senior Vice President, Sales & Services, Toyota Kirloskar Motor said, “The challenge that lies ahead of us is the fact that for the auto sector to start production, it is necessary that our entire value chain starts operating. Our value chain consists not only of our suppliers but our dealers as well who are based in different parts of the country including cities that are still under severe lockdown.”

Toyota Kirloskar Motor will commence some preparatory operations at the plant. The company said that these preparatory operations are conducted to provide its workforce with an adequately safe environment to work in, duly prioritising domains like spare parts supply as that is an important requirement from the markets where certain customer service activity has already started. “Furthermore, we have developed certain crucial changes in guidelines for enhanced safe operations in all areas of work, which would mean that the first few days will be spent on training our members on the new guidelines as well as ensuring safe materials and working environment. Hence, operations at our plant will resume in a phased manner, most importantly keeping in mind the needs of ‘social distancing’ and sanitisation,” the statement said.

Although, the Gurugram administration has given permission, India’s largest carmaker, Maruti Suzuki, is yet to announce commencement of its manufacturing operations at its plants. Hero Motocorp has resumed production, and to begin with, it
has commenced operations in a graded manner at three of its manufacturing plants, Gurugram and Dharuhera (both in Haryana), Haridwar (Uttarakhand) and additionally the Global Parts Centre (GPC) at Neemrana in Rajasthan. However, Hero
Motorcorp said that only the essential staff will come to work at all the other facilities and corporate offices, observing social distancing and all prescribed safety measures. The remaining employees across all locations in India will continue to Work from
Home (WFH) until further notice.