The index of industrial production (IIP) numbers released on Monday seems to have dampened sentiments of the automobile industry. Along with the downtrend, a likely hiring freeze is on the cards.
“Many companies have gone for production cut,” said P Balendran, vice-president, General Motors India. “No fresh hiring is taking place.”
“There is a need for caution,” said Prince Augustine, executive vice-president, human resources, Mahindra & Mahindra, who heads human capital group of the auto industry body Society of Indian Automobile Manufacturers (SIAM). “It is easy to hire but downsizing is very painful.”
According to SIAM, it is doubtful whether the car industry would be able to meet the 2-4% growth forecast for 2011-12. Car sales are marginally down so far this fiscal.
Top auto honchos including Balendran of GM, Arvind Saxena, director, marketing, Hyundai Motor and Shashank Srivastava, chief general manager, Maruti Suzuki, believe that the next two quarters will be tough for the auto industry.
This thinking seems to have influenced the hiring approach of manufacturers. Indian auto industry currently employs close to 15 million people and would need at least 10 million more by 2018.
However, the immediate future in terms of job generation in the industry does not seem to be so bright.
“In the next two years there won’t be massive hiring. But in the long term, there will be huge requirement,” said Augustine.