MRF Ltd declares lockout at Arkonam

"The management has declared lockout at the company's manufacturing plant situated at Arkonam in Tamil Nadu with effect from 3 pm, on May 17 on account of labour unrest in the factory," the company.

About 3,000 employees of MRF in Arkonam and Puducherry were on a 'sit-in' strike within the premises of the respective facilities since May 9. The workers went on strike as they were "disappointed with the management as the company denied recognition to it" and 150 labourers were also dismissed by the management so far. The Arkonam plant produces 10,500 radial tyres a day, while MRF's Puducherry unit makes 26,000 units of tyre and 42,000 tubes a day.

Impact auto production

Meanwhile, the lockout is likely to impact production of some of the leading automobile makers, including Honda Motorcycle and Scooter India (HMSI), Bajaj Auto and Maruti Suzuki India (MSI), to whom the tyre major is an original equipment supplier.

"Our motorcycle production will be impacted as MRF is 100 per cent original equipment supplier for us," HMSI Head (Sales and Marketing) N K Rattan told PTI.

While the company has not stopped production yet, he said going forward it is going to be difficult unless supplies are available. "But MRF has told us that they are trying to find an alternative to ensure supplies."

MSI, which also sources tyre from MRF for some of its products, is assessing the development. "We are ascertaining the situation and impact. Also we are looking at augmenting supplies from other sources," an MSI spokesperson said.

Two-wheeler maker Bajaj Auto, to which MRF also supplies bike tyres, said since its volumes sourced from the tyre major are small, its production will not be impacted immediately.
Press Trust of India