Describing the current economic crisis as the worst ever, Tata Group chairman Ratan Tata has asked his 3.5 lakh strong workforce to brace itself for hard decisions that would have to be taken by the management teams of many of the group’s 96 companies.
In a New Year message to his employees, Tata said the economic downturn would continue through most of 2009 and the biggest challenge would be to sustain a “meaningful level of operation through the next nine to twelve months”.
“The global financial crisis, non-availability of credit at reasonable rates and consequential drop in demand in most sectors have severely impacted most of our companies,” Tata said in the letter dated December 31. “This economic crisis may well be the worst we have ever faced in our living history.” In November Tata had sent an e-mail to all the heads of his companies, asking them to defer all expansions and acquisitions.
In his letter Tata reiterated the “need to operate most cost effectively and conserve our cash”. “The most challenging task is to sustain a meaningful level of operation,” he said. “It will call for hard decisions on the part of the management teams in many of our companies and call for deferment of all avoidable expenditure and growth plans.”