Pricol Shutdown Its Plant To Avoid Inventory
Pricol, a leading auto ancillary company, has decided to further trim production due to adverse market conditions. The company informed stock exchanges on Wednesday, to avoid inventory pile up, it will close down close Coimbatore plant IV and Uttarakhand plant VI from January 22 to 31. A company official said it is also planned to block holidays at plant I, III and IV in Coimbatore for three days from January 29 to 31. "We have inventory for almost 20 days against the normal five days and hence slowing down production," said another official. He said there was nearly a 30% drop in orders in the last few months. "The compan y used to Rs 52 crore to Rs 55 crore business every month, but due to recession, we are doing only Rs 40 crore business per month now," he added. Following the move to block holidays, around 220 workers employed at plant IV (Karamadai, Coimbatore) and plant VI (Uttarakhand) would have no for ten days.
Also, the three day closure planned in all the three units in Coimbatore would keep 1800 workers away from work during the period. Asked about the understanding with workers, he said "Initially during December, we paid them full salary but we will not be able to do that every time. So the block holidays would be adjusted against the workers’ leave entitlement." The workers draw 25% of their salary as incentive and these holidays would mean reduction in their variable pay, he added. Earlier, in December Pricol had resorted to full and partial block holidays at various plants in the country. Recently, the company closed Coimbatore plant I, III, IV from January 15 to 17 coinciding with the harvest festival in the state.
