India’s Maruti Suzuki may see its Manesar factory closed for several weeks, bringing the company losses of $15 million a day.
With a manager dead, 90 employees imprisoned and the entire factory workers under investigation, the Manesar factory has a bleak future ahead. The Police said they plan to detain all 3,000 employees, after a riot erupted on Wednesday, July 18th, after a disciplinary incident with an employee. During the riot, a portion of the plant’s assembly line was damaged, which translates in supply disruptions of the Maruti’s most popular hatchback which is manufactured at this plant.
“Whenever production resumes, the morale of the executives deployed at the plant would be one of apprehension, fear,” added ICICI Securities, a brokerage, in a report on Friday.
Analysts expect production to be stopped at least two weeks, taken into consideration the tension between employees and the management, and also the severity of the damage. On Thursday, July 19th, the company lost more than $570 million in market value, as its shares fell 8.9%.
“Part of the manufacturing area is burned, the whole building is burned, and the people who are running the factory are injured and admitted in the hospital, so it will take a little time,” said the official, who was not authorised to speak to the media.