The fear coronavirus spread has halted manufacturing in the industrial townships in Maharashtra and Gujarat. Most of the companies in these states have started production cuts since the last two days. The plant shutdowns largely started from Sunday and it will continue till March 31. However, there is uncertainty over when they will be able to reopen the plants, considering the nature of the epidemic.
The automobile companies working out of Pune, including Bajaj Auto and Tata Motors, are shutting down the complete production. Fiat Chrysler Automobiles' facility in Ranjangaon has been temporarily shut down operations. Luxury carmaker Mercedes-Benz also shut down its assembly factory located at Chakan, Pune. Other automakers like Volkswagen, Skoda and Force Motors, who have facilities in Maharashtra, are also preparing for the same.
In the last week, Reliance Industries has worked with a thin workforce at the Reliance Corporate Park in Navi Mumbai and the Jamnagar refinery complex. It will continue working with a critical number of staffs and workers in the coming week. Larsen &Toubro, Bharat Forge and the public sector companies are also doing the same.
The Indian railway has cancelled passenger trains until March end as a large section of migrant workers, including those who work for companies in Maharashtra and Gujarat, started rushing back to their villages. The railway officials say that more than 1 lakh migrant workers fled Mumbai on March 20 alone as the economic activity came to a virtual standstill. The same volume of the rush was seen in Pune and Ahmedabad, said officials in the know. These workers are largely from Maharashtra, Uttar Pradesh, Jharkhand and Bihar.
The company executives feel that it would take at least a couple months to normalise the production if the situation continues to be under control. "The economic damages will spread across two quarters," said an executive.
Maharashtra is the worst hit with 63 confirmed cases. Kerala has the second-highest number of cases at 52.
Pune-based Bajaj Auto will close down its plants in Akurdi and Chakan in Pune for eight days starting from 23rd to 30th March in compliance with Maharashtra government's orders. Tata Motors has scaled down its operations at its Pune plant following Maharashtra government order to shut down all workplaces till 31st March in order to prevent infection.
Pune, Maharashtra's second-largest city after Mumbai, has been a hub for the automobile industry for decades.
Tata Motors' MD and CEO Guenter Butschek said "We have decided to rapidly scale down activities at Pune site to get to skeletal operations by end of Monday, 23rd March 2020 and be ready for plant closure by end Tuesday, March 24th, 2020 if the situation warrants. We will continue in this mode till 31st March."
Similar to what Detroit based automakers did, Mahindra Group Chairman Anand Mahindra tweeted on Sunday that the company will manufacture ventilators after closing down the automobile manufacturing. Mahindra has plants in Kandivali, Pune, Nashik among others.
Mahindra offered Club Mahindra Holidays' resorts as temporary care facilities. Mahindra said that cases could rise exponentially with millions of casualties, putting a huge strain on medical infrastructure and hence "a lockdown over the next few weeks will help flatten the curve and moderate the peak pressure on medical care."
N Chandrasekaran, Chairman, Tata Sons said in a media statement that
the current situation arising out of the outbreak of Covid 19 is likely to have a large and deep financial impact on the weaker socio-economic segments of our society.
"During this time of crisis, our group companies commit to ensuring full payments to the temporary workers and daily wage earners who are working in our offices and at our sites in India for the month of March and April, 2020, even if these workers are not able to work due to either quarantine measures, site closures, plant shutdowns or other reasons." he said.