CHENNAI/MUMBAI: The Tata Group may eliminate jobs at some businesses to save fixed costs as it grapples with falling profits due to the pandemic, and global economic projections pointing to a challenging time ahead.
The pandemic had led to a suspension of the conglomerate’s several businesses — including aerospace, automotive and aviation — depressing its earnings in key markets across the world. The conglomerate has already made moves to cut contract workers engaged in manufacturing and other functions at its various facilities, including at Tata Motors and its arm Jaguar Land Rover.
Tata Motors, after sinking Rs 9,864 crore into the red in the fourth quarter of fiscal 2020, said “there are widespread opportunities to cut costs across the organisation and all actions will be taken with prudence”, without getting into specifics. The flagship of the Tata Group has initiated a cash improvement programme of Rs 6,000 crore and 5 billion pounds at its India and UK units. Sources said the company plans to axe jobs at various levels in the domestic business. The labour union at Tata Steel’s Netherlands unit said the management planned to slash 1,000 of the 9,000 jobs at the site to improve the profitability of the metal producer.
The senior leadership at the group’s several businesses, including Indian Hotels Company (which runs the Taj chain), has already taken a cut in remuneration as part of a broader restructuring plan. The $113-billion conglomerate — comprising 30 companies across 10 business verticals — employs over 7.2 lakh people in India and outside the country. The group’s real estate unit, said sources, may also retrench employees even as it battles mismanagement allegations. “With the advent of Covid-19, we are closely monitoring the situation and assessing its impact on the real estate industry and on the company,” said a Tata Realty and Infrastructure spokesperson.