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May 28, 2001
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Money > Business Headlines > Report May 28, 2001 |
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Tata Engineering's 600 officials opt for VRSV Phani Kumar Tata Engineering's maiden voluntary retirement scheme targeted at its managerial cadre has seen over 600 managers and officers biting the bait. In addition, over 2,500 workers from across the organisation have also opted for the VRS, bringing down the company's employee strength to close to 24,500, senior company officials said. Company officials did not divulge the VRS outgo, but analysts said the company could be making substantial savings as a result of the VRS. Tata Engineering had introduced the VRS in the third quarter of fiscal 2000-01, as part of a massive cost-cutting to contain its mounting losses. The company recorded one of its worst performances in the fiscal, when sales from both the commercial vehicles and passenger cars divisions were adversely hit by the downturn in the domestic industry. The company has recorded losses of Rs 3.53 billion during the first nine months of 2000-01 in spite of its aggressive cost-cutting measures. Further, the company has in recent months exited from its investments in Mercedes-Benz India and Tata Elxsi. Analysts feel that the company's poor performance will continue at least till the second quarter of the current fiscal. On the positive side, the company has recently reintroduced the 697 series of engines for commercial vehicles alongside the high-performance Cummins engines, in addition to introduction of a host of new variants. The company is aggressively pushing volumes in the southern markets, where it had a weaker presence. Also, the rationalisation of sales tax during the previous fiscal had relatively little impact in the southern markets, as the sales tax in the south was earlier higher than in the northern markets. Tata Engineering has traditionally been a weaker player in the south, where Ashok Leyland, the Hindujas' flagship company, has a stronger presence. Powered by YOU MAY ALSO WANT TO READ:
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