New Delhi: Two wheeler major Honda Motorcycle and Scooter India (HMSI) has initiated a Voluntary Retirement Scheme (VRS) for permanent workers amid challenging market conditions, as per a company notice.
The VRS would run from January 5 till January 23 this year and cover permanent employees barring director level officials, according to a communication sent by the company management to the Manesar plant employees.
The permanent employees who have completed 10 years with the company as on January 31, 2021 or who are above 40 years of age can opt for the VRS.
Director rank officials, however, are not a part of the scheme, as per the communication.
Under the scheme, Senior Manager-Vice President and permanent workmen can get a maximum amount of Rs 72 lakh, Manager can get Rs 67 lakh, Deputy Manager (Rs 48 lakh), Assistant Manager (Rs 36 lakh), Senior Executive (Rs 31 lakh), Executive (Rs 27 lakh) and Assistant Executive (Rs 15 lakh).
The company is also offering Rs 5 lakh extra for the first 400 employees who opt for the scheme.
According to the communication sent to employees at the Manesar facility, the Indian auto industry was passing through challenging times as sales have dropped due to COVID-19 and resultant downturn in the economy.
The two wheeler major noted that in such tough conditions the management is trying to streamline its operations and production activities.
In order to stay competitive and relevant in the highly competitive two wheeler industry, it is important for the company to stay efficient and cost competitive, the communication said.
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"So in order to take care of all these issues, the company has come up with the VRS scheme so that the permanent associates can part with the company with dignity," it said.
The company reported a 3 per cent increase in total sales in December 2020 at 2,63,027 units. It sold a total 2,55,283 units in the same month in 2019.
When contacted, the company in a statement said that the Indian auto industry is going through an exceptionally challenging phase for the past 3 years considering the prolonged demand slowdown and overall economic fallout from COVID-19 pandemic.
"The VRS scheme announcement for our associates is a part of Honda's overall production realignment strategy across all four factories to improve our operational efficiency with the objective of ensuring long term business sustainability," it added.
The VRS gives a new opportunity to those associates who may wish to explore new dimensions in their life and empowers them with best among the industry financial and healthcare benefits while helping the organisation improve its overall operational efficiency, the statement said.
The company, however, did not clarify whether the current VRS covers only the Manesar facility or is applicable for its other facilities as well.
"As the largest contributor to Honda's global motorcycle business, India continues to be a priority market for Honda. HMSI continues to see a strong potential to develop as Honda's global export hub in the mid-term given its unique economies of scale and new strength of its technologically advanced BS-VI model line-up across automatic scooters, mass motorcycles and premium bike portfolio," it added.
Hence, firmly believing in the future market potential, the company's investment plans for future product and technology introduction remain unchanged, HMSI noted.
(PTI)
