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Toyota India Unit Locks Out Workers at Two Plants as Pay Dispute Drags

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March 17, 2014 3:55 PM EST

Toyota Motor Corp's (7203.T) Indian unit has declared a lockout of its workers at two car plants after strained salary negotiations spurred workers to stop production lines.

REUTERS
Toyota Motor Corp's Indian unit has declared a lockout of its workers at two car plants after strained salary negotiations spurred workers to stop production lines.

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Toyota Kirloskar Motor (TKM) in a statement said it has locked out workers at the plants near Bangalore since Sunday. It did not state for how long the lockout will continue.

Over the past 25 days, some workers have stopped production lines and disrupted business as the management, labour union and local government failed to reach an agreement over salaries, TKM said.

"The company is left with no other option but to declare a lockout of the premises to ensure the safety of its workers and management personnel," TKM said.

Tokyo-based Toyota Motor spokesman Naoki Sumino said the unit and union will continue holding talks to resolve the issue.

If operations are suspended, that would result in a production loss of 700 vehicles a day, Sumino said.

TKM manufactures vehicles including the Fortuner and Innova at its 1st plant, where production started in 1997. At the 2nd plant, which opened in 2010, it makes cars including the Etios and Corolla Altis.

Toyota is not the first Japanese car maker to be hit by labour relations troubles in India.

In 2012, Suzuki Motor Corp (7269.T) unit Maruti Suzuki India Ltd (MRTI.NS) closed its Manesar plant for a month after a riot that resulted in one death, over 100 injuries and a $250 million production loss.

(Photo: REUTERS / FRANCOIS LENOIR/FILES)
Toyota Motor Corp's Indian unit has declared a lockout of its workers at two car plants after strained salary negotiations spurred workers to stop production lines.
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