New Delhi: Amid growing concern about how a lengthy strike at the Maruti plants in Gurgaon and Manesar are affecting the company and consumers, the chief of Maruti, R C Bhargava told NDTV that he expects a resolution in "the next two-three days." Mr Bhargava said that reports that Maruti wants to abandon its plant in Haryana are untrue. He also confirmed that Maruti is in negotiations with the Gujarat government to set up a production plant in Narendra Modi's state. Like many other industry leaders, Mr Bhargava praised Mr Modi's ability to draw new projects. He said Mr Modi's approach is "different" and "in our favour."
Here is the transcript of the entire interview:
NDTV: Clearly, the strike continuing when the talks between the workers and the management have failed. When do we expect the strike to really end?
Bhargav: The talks between the workers and the management are continuing. They haven't failed, they are still continuing and I think they will continue day after tomorrow because these kind of talks don't get resolved. The issues don't get resolved in one day and to dub them as a failure is a little unfair.
NDTV: But Mr Bhargav, serious doubts are really being raised as Manesar now as a hub for automakers, whether it's Manesar in particular or Haryana in general. Also is Maruti now looking at of setting its plant in Gujarat? Could you confirm the talks have taken place with the Gujarat government?
Bhargav: No, you are aware that we have been looking for sites outside of Haryana now for future expansion once the whole potential of Manesar and Gurgoan has been fully utilised. The search for a site had been started more than a year ago and we have talked to Gujarat, we have talked to the Chief Minister and the commitment which we have made was that in October, before the month of October ended, we would take a decision on where we want to set up our new plant once this plant was fully utilized.
NDTV: What about the possibility of moving out of Manesar given the recent labour unrest? I will talk about Gujarat in just a bit but are you also looking at moving out of Manesar? Are you disappointed with the way the Haryana government has handled this recent labour unrest?
Bhargav: Though I think that the Haryana government has done everything in the proper manner, we are not at all disappointed with what the Haryana government has done. We are very happy with the way they have handled the issues and we are not at this point, at all, contemplating any move to move out of Manesar. We have made a big investment in Manesar and it will not be a feasible proposition to move out of Manesar. Can of course be considered if nothing happens and it becomes an absolute dead investment but I don't think that's going to happen.
NDTV: Well Sir, it's not just Maruti, earlier it was Honda Motorcycles and Scooters that was facing a lot of problems in Haryana in Manesar. Do you believe the recent unrest in many ways questions whether Haryana or Manesar can be a hub for automakers or for the industry?
Bhargav: Well, it's a fact that in and around Manesar, in this part of Gurgaon and Faridabad, there has been greater intensity of labour agitations than in most other parts of the country, but I think it's a passing phase and it will take a little more time for the workers to realise that this kind of agitation does not help them, jobs are not really easy to get and if they really drive industry out of this area, then I think they will the biggest losers. So I think they will realise that; people here are quite mature and sensible in that sense and I am fairly hopeful that over time, this thing will settle down.
NDTV: Mr Bhargav, we know that you will be taking a decision on your new plant and where to settle it in the board meeting on the 29th of this month but would it be really fair to say that Gujarat really tops the list when it comes to the locations that you have shortlisted?
Bhargav: Gujarat is certainly a state which has many things going in favour of it but as we have been saying in the past also, no decision has been taken on Gujarat or any other state at this point of time. It only happens when the Board meets on the 29th.
NDTV: The Gujarat government, it seems, has offered 500 acres to Maruti. A specific site has been identified. You have already engaged in talks with the Gujarat government as you just mentioned. So talks, in that sense, have gone forward. We have already seen another case in point - Tata Motors having chosen Gujarat as a location. Possibly we are looking at a larger trend there?
Bhargav: Well certainly, we have looked at land in Gujarat. The state government has suggested plots of land and we are aware that other automobile companies are looking at Gujarat. That is why we have to take a decision fairly soon because we also realise that the Gujarat government can't wait indefinitely and this land will be made available to others if we don't take it.
NDTV: But would it be correct to say that perhaps the Gujarat government is wooing you most aggressively among the other states that you may also be considering?
Bhargav: The Gujarat government certainly goes to help industry come up there as the Chief Minister of Gujarat mentioned to us once, said my role is to facilitate to let industry come up in Gujarat, it's not to regulate industry to come in to Gujarat. I think that is a different approach to what we have heard in the other places where there is more of regulation and less of facilitation and I think that's one thing that goes in favour of Gujarat.
NDTV: Sir, moving on and talking about how badly the strike has affected Maruti in terms of your production and in terms of the losses, clearly it's now that your rivals are celebrating. They ramped up production; they are seeing their market share go up. Are you extremely worried that the long-term impact that this strike will have on your company?
Bhargav: Well, certainly the strike of this kind, the way it has happened in three different installments with two settlements being reached with the workers and both times the settlements having been put aside by the workers and their going on a strike again, is a matter of considerable worry to us. The loss is one part of it; the greater worry is that we look at a set of workers who, at this point, perhaps guided by the advisers from outside don't seem to respect the rule of law and they feel that agreements and settlements and all don't have much meaning.
NDTV: But sir, many doubts are being raised about how Maruti's work practices have changed over the years. You know, it was seen as a company run in a typically Japanese style and that something that worked and it was a model employer. Now, many say that Maruti's work practice has become similar to the Chinese punishing work culture. Would you agree?
Bhargav: I have read this in the press and I am afraid that the author of this article has gone completely wrong. The work practices we have are not changed at all from the beginning. In Gurgaon, we introduced the Japanese style of management including a 7 and a half minute break. This has been there since 1983. The article today in the newspaper suggested that 7 and a half minute is something that has only happened in 2010. I think he has got his facts wrong. From 1983, the tea break has been 7 and a half minutes long. People do report to work before the shift starts. The shift starts exactly when it is supposed to start. People work for almost eight hours a day which is what they are paid to do. So this has got nothing to do with Japanese or Chinese. It is what work practices should be. We are not following the practices that have developed over the years where for various reasons the workers don't work for more than five hours, five and a half hours, in an eight-hour shift.
Here is the transcript of the entire interview:
NDTV: Clearly, the strike continuing when the talks between the workers and the management have failed. When do we expect the strike to really end?
Bhargav: The talks between the workers and the management are continuing. They haven't failed, they are still continuing and I think they will continue day after tomorrow because these kind of talks don't get resolved. The issues don't get resolved in one day and to dub them as a failure is a little unfair.
NDTV: But Mr Bhargav, serious doubts are really being raised as Manesar now as a hub for automakers, whether it's Manesar in particular or Haryana in general. Also is Maruti now looking at of setting its plant in Gujarat? Could you confirm the talks have taken place with the Gujarat government?
Bhargav: No, you are aware that we have been looking for sites outside of Haryana now for future expansion once the whole potential of Manesar and Gurgoan has been fully utilised. The search for a site had been started more than a year ago and we have talked to Gujarat, we have talked to the Chief Minister and the commitment which we have made was that in October, before the month of October ended, we would take a decision on where we want to set up our new plant once this plant was fully utilized.
NDTV: What about the possibility of moving out of Manesar given the recent labour unrest? I will talk about Gujarat in just a bit but are you also looking at moving out of Manesar? Are you disappointed with the way the Haryana government has handled this recent labour unrest?
Bhargav: Though I think that the Haryana government has done everything in the proper manner, we are not at all disappointed with what the Haryana government has done. We are very happy with the way they have handled the issues and we are not at this point, at all, contemplating any move to move out of Manesar. We have made a big investment in Manesar and it will not be a feasible proposition to move out of Manesar. Can of course be considered if nothing happens and it becomes an absolute dead investment but I don't think that's going to happen.
NDTV: Well Sir, it's not just Maruti, earlier it was Honda Motorcycles and Scooters that was facing a lot of problems in Haryana in Manesar. Do you believe the recent unrest in many ways questions whether Haryana or Manesar can be a hub for automakers or for the industry?
Bhargav: Well, it's a fact that in and around Manesar, in this part of Gurgaon and Faridabad, there has been greater intensity of labour agitations than in most other parts of the country, but I think it's a passing phase and it will take a little more time for the workers to realise that this kind of agitation does not help them, jobs are not really easy to get and if they really drive industry out of this area, then I think they will the biggest losers. So I think they will realise that; people here are quite mature and sensible in that sense and I am fairly hopeful that over time, this thing will settle down.
NDTV: Mr Bhargav, we know that you will be taking a decision on your new plant and where to settle it in the board meeting on the 29th of this month but would it be really fair to say that Gujarat really tops the list when it comes to the locations that you have shortlisted?
Bhargav: Gujarat is certainly a state which has many things going in favour of it but as we have been saying in the past also, no decision has been taken on Gujarat or any other state at this point of time. It only happens when the Board meets on the 29th.
NDTV: The Gujarat government, it seems, has offered 500 acres to Maruti. A specific site has been identified. You have already engaged in talks with the Gujarat government as you just mentioned. So talks, in that sense, have gone forward. We have already seen another case in point - Tata Motors having chosen Gujarat as a location. Possibly we are looking at a larger trend there?
Bhargav: Well certainly, we have looked at land in Gujarat. The state government has suggested plots of land and we are aware that other automobile companies are looking at Gujarat. That is why we have to take a decision fairly soon because we also realise that the Gujarat government can't wait indefinitely and this land will be made available to others if we don't take it.
NDTV: But would it be correct to say that perhaps the Gujarat government is wooing you most aggressively among the other states that you may also be considering?
Bhargav: The Gujarat government certainly goes to help industry come up there as the Chief Minister of Gujarat mentioned to us once, said my role is to facilitate to let industry come up in Gujarat, it's not to regulate industry to come in to Gujarat. I think that is a different approach to what we have heard in the other places where there is more of regulation and less of facilitation and I think that's one thing that goes in favour of Gujarat.
NDTV: Sir, moving on and talking about how badly the strike has affected Maruti in terms of your production and in terms of the losses, clearly it's now that your rivals are celebrating. They ramped up production; they are seeing their market share go up. Are you extremely worried that the long-term impact that this strike will have on your company?
Bhargav: Well, certainly the strike of this kind, the way it has happened in three different installments with two settlements being reached with the workers and both times the settlements having been put aside by the workers and their going on a strike again, is a matter of considerable worry to us. The loss is one part of it; the greater worry is that we look at a set of workers who, at this point, perhaps guided by the advisers from outside don't seem to respect the rule of law and they feel that agreements and settlements and all don't have much meaning.
NDTV: But sir, many doubts are being raised about how Maruti's work practices have changed over the years. You know, it was seen as a company run in a typically Japanese style and that something that worked and it was a model employer. Now, many say that Maruti's work practice has become similar to the Chinese punishing work culture. Would you agree?
Bhargav: I have read this in the press and I am afraid that the author of this article has gone completely wrong. The work practices we have are not changed at all from the beginning. In Gurgaon, we introduced the Japanese style of management including a 7 and a half minute break. This has been there since 1983. The article today in the newspaper suggested that 7 and a half minute is something that has only happened in 2010. I think he has got his facts wrong. From 1983, the tea break has been 7 and a half minutes long. People do report to work before the shift starts. The shift starts exactly when it is supposed to start. People work for almost eight hours a day which is what they are paid to do. So this has got nothing to do with Japanese or Chinese. It is what work practices should be. We are not following the practices that have developed over the years where for various reasons the workers don't work for more than five hours, five and a half hours, in an eight-hour shift.
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