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Maruti workers locked out over 'sabotage'

business Updated: Aug 29, 2011 14:35 IST

Production at a Maruti Suzuki plant was halted on Monday as India's top carmaker locked out its workers, demanding they sign a "good conduct" pledge following alleged sabotage, the company said.

The Japanese-controlled company said it had asked all workers at its Manesar plant to sign a "good conduct" bond, promising they would not sabotage production, resort to go-slow tactics.

"Production is right now at a stop," said a company spokesman, who declined to be named, citing company policy.

It was the third dispute to affect production at Maruti Suzuki in three months.

The 2000 workers were not allowed to enter the plant, until they had signed the pledge, the company said.

The spokesman said 10 workers had been suspended and five fired last week for "sabotaging production and deliberately causing quality problems" at the Manesar plant, which rolls out about 1,200 vehicles every day in two shifts.

The production problems were discovered during quality-control checks and included doors falling off and dents in car bodies, according to the firm.

"The situation had reached a stage where it was directly harming customers' interest and trust," the spokesman told AFP.

The Maruti spokesman said some workers had signed the good conduct pledge but he could not immediately say how many.

In June, 11 days' worth of production was lost, costing the company nearly $93 million, after workers downed tools demanding recognition of a new union and the reinstatement of dismissed workers.

In July, production was again halted for a day due to a labour dispute at the plant.

Maruti sells nearly half of all new cars in India. But it reported earlier this month that sales had fallen by 25.3% in July -- its sharpest ever monthly fall -- from a year earlier, hit by high interest rates which pushed up the cost of consumer car loans.