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This presentation details about Toyota, the Japanese automaker, laying down its history, global competitiveness, leadership in the global automobile industry and some HR issues leading to labor strikes in its manufacturing plants in India.
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Toyota Strike
Karnataka
2006
Toyota Motor Corporation - Japanese
automaker
Headquartered - Toyota, Aichi, Japan
333,498 employees [2013]
13th largest - revenue [March 2013]
2nd largest passenger automobile
manufacturer - production [2012]
Largest - overall production (including
commercial vehicles)
Largest listed company in Japan - market
capitalization & revenue [2013]
Chairman - Takeshi Uchiyamada & CEO – Akio
Toyoda
TMC – An Introduction
"Founded by Kiichiro Toyoda in 1937
as a spinoff from his
father's company Toyota Industries to
create automobiles"
Kiichiro Toyoda
Sakichi Toyoda
Sakichi Toyoda
Toyota Industries
Japan’s 1st Power loom
Toyota’s 1st Car
Toyota Motor Corporation
Kichiro Toyoda
Market Share – 40% [Japan]
Automobiles – passenger cars, luxury vehicles,
commercial vehicles, engines
Toyota - top rank - 9,909,440 units produced
globally [2012]
Services – banking, insurance, leasing
On May 8, 2013
• Net revenues - 22.0 trillion yen [US$ 216.7 billion]
• Operating income - 1.32 trillion yen [US$13 billion]
• Net income - 962.1 billion yen [US$9.47 billion]1 USD =
102.31 JPY1 INR = 1.63
JPY
Japan25%
Oceania3%
Asia11%
Middle East7%Africa
4%
Europe14%
Latin America
4%
North America
32%
Toyota Sales By region
Source – www. toyota.com
Toyota Motor Corporation produces
vehicles under 5 brands –
Toyota
Hino
Lexus
Ranz
Scion
Toyota Kirloskar Motor Private Limited
Joint Venture – TMC [99%] & Kirloskar Group [1%]
4th largest car maker - Maruti Suzuki, Hyundai, and
Mahindra
Manufacturing unit – Bangalore, Karnataka
Investment of INR 7 billion in October 1997
Initially, held equal shares, then 79:21 & to 99:1
Current plant - Bidadi, Karnataka - 432 acres - 80,000
v.p.a.
2nd plant - outskirts of Bangalore, Karnataka - 70,000
v.p.a.
More than 249 dealerships in 144 cities across
28 states and union territories
TKML – An Introduction
State Govt. Granted Scores Of
Incentives
Entry Tax
Pollution Control
Land Acquisition
Power & Water Supplies
Karn
at
aka
Outskirts of Bangalore
Toyota Plant
Maruti Suzuki46%
Hyundai16%
Mahindra &
Mahindra12%
Toyota6%
Tata Motors
6%
Honda4%
Chevrolet4%
Renault3%
Volkswagen3%
Car Sales by Units - 2013
Source – www. mbaskool.com
Toyota In India Corolla [2003]
Innova [2005]
Etios [2010]
Fortuner [2009]
Camry [2002]
Qualis [1999 – 2005]
Land Cruiser [2009]
Background of Workforce
3 categories of employees in TKML
Managerial staff - higher management officials - MD
Senior staff to supervisors & general workers
3rd group - contract laborers – specific tasks
And group - general workers on the main line
• Team member trainees
• Probationary and team members
Young Workforce - the ages ranging from 21 to 29
years
Discourages women employees on main line
production/assembly
Workers on the main line are technically trained
Majority of workers - Bangalore city or neighboring
districts
Case Abstract
Examines industrial relation problems at Toyota Kirloskar
Motor Private Limited
Reasons - led to the dispute between the management & the
employees
Elaborates incidents - led to the strike &
lockout
Influence of external parties - trade unions & the government
What the case is about ?
TKM had a history of
disturbed relations between
the management and the
workers
Prior to the strike and lockout
in January 2006, the plant had
experienced three other strikes
–
two in 2001, and a strike and a
lockout in 2002 [lasted for
almost two months]
1st - April
2001 2
days
2nd - June
same
year
In 2002 - two
shifts to meet
the increased
demand
2001
Nominal increase made employees upset &
they boycotted lunch for one day as a protest,
management ordered and pushed the workers
outside the factory
Management announced Rs. 300 nominal wage hike
Dharna started by workers
TLM announced establishment of a Team Member Association (TMA) – 15
members elected
TMA committee member Mr. Renka
Prasad terminated on the charge of
non-performance
TMA elected committee members; decided to register it as a trade
union
TMA is only for work ware issue, canteen issue, or safety issue; refused
to discuss termination
Employees provoked and immediately
went for strike
Job security
Taking back retrenched 3 employees
To reduce the training period from 3
to 1 year
Strike continued for 12 days
2002
Union gave strike notice2 union officials - General Secretary Mr.
Shiv Kumar B & Joint Secretary Mr. Raghu R terminated
Strike - 52 days – take back union leaders
TKM demanded two shifts to meet the increased demand
1st shift - 8 AM to 4 PM & OT - 4 PM to 8 PM
Settlement - Rs 2,500 increase of wage after negotiation
Karnataka government declared Toyota as an essential service
Strike was banned with this order and workers returned to work
2006
On January 08,
2006, TKML
announced an
indefinite lockout
of its vehicle
manufacturing
plant at Bidadi
located near
Bangalore,
Karnataka
Reason - strike,
which had entered
its 3rd day, by the
Toyota Kirloskar
Motor Employees
Union
Lockout notice
stated - strike was
illegal as the
Employee Union
did not give the
mandatory 14
day notice period
as per Industrial
Disputes Act,
1947
Also - workers were
indulging in
violence and
destruction
Total workforce of
2,378 out of which
around 1,550
employees belonged
to the Employee
Union
On January 06,
2006, the EU went on
strike with the
demand - reinstate
3 dismissed
employees, 10
suspended
employees, &
improve the work
conditions at the
plant
Employees -
dismissed &
suspended -
attacking a
supervisor &
misconduct
TKM declared – not
to rehire or
reinstate those
employees
culminating in the
strike and lockout
Workers were
threatening to blowup
LPG gas cylinders
Obstructing the
outward movement of
manufactured vehicles
Illegally stopping
production
Manhandling non
EU workers
Active in trade
union activities
Suppress the trade
union
Working
conditions -
inhuman and 'slave
like'
Insufficient
relaxation and
compensation
TKM
TKMEU
January 09, 2006 -
TKM refused meeting
before the Labor
Commissioner - 2
weeks time
EU got support from
various trade unions -
AITUC, CITU
Demanded the
intervention of the
state government
Continued partial
production of
vehicles - non-
unionized
workers &
management staff
- trained for such
emergencies
Output fallen from
92 to 30 vehicles
per day
Production loss of
around INR 700
million
Lifted lockout -
January 21, 2006
Request from workers
eager to return to
work
Workers were required
to sign a good
conduct undertaking
to maintain discipline
and ensure full
production
EU relented &
withdrew their
strike -
Government
Order on January
21, 2006
Referred the issue
– 3rd Additional
Labor Court
Refused to sign
initially - good
conduct
declaration
Worker’s Demands
• Good Working Conditions
• Wage Revision & Increment
• Period of Traineeship
• Abolition of Contract Labor
System
• Reinstatement of Suspended
Workers
TKM won the match ?
TKM's management never reinstated the
dismissed workers
TKM did not face any major problems due
to the strike of the
workers and the lockout at its plant
TKM had made appropriate arrangements
to meet the
market demand for its cars
Much of the worker’s demands were
suppressed
OR
Were the worker’s right in
fighting for their
demands ? Were the demands
justified ?
Was the management right in
suppressing the union ?
Bibliographyhttp://www.hindu.com/
http://www.icmrindia.org/
http://www.iasir.net/
http://www.toyota.com/
http://www.toyotabharat.com/
http://www.mbaskool.com/
Thank
you !
Any
Queries ?