Mazars to Monitor Asset Sale Process of Lafarge India
Fair trade regulator CCI asks auditor to ensure competition laws are followed
New Delhi: The country’s fair trade regulator Competition Commission of India (CCI) has appointed French audit firm Mazars to monitor the divestment of French cement giant Lafarge’s entire India operations.
Mazars will ensure that the proposed asset sale of Lafarge India — for overcoming regulatory hurdles over its multi-billiondollar merger with Swiss rival Holcim last year — does not have any adverse effect on competition in Indian cement market, a senior government official said.
“This agency will review the potential buyers and review the progress of the divestiture process. The agency would supervise a swift completion of divestment process and will also see that all combination laws under the Competition Act of 2002 are followed,” the official said.
Competition Appellate Tribunal (Compat), which hears cases against CCI, early this month had put Lafarge’s divestment on hold till May 9 after Dalmia Cement approached it. third party, Mazars India, to supervise divestment process of Lafarge India assets stay on Lafarge India sale till May 9 after Dalmia Cement argued that CCI could not approve stake sale until the acquirer was known CCI will now tell Compat that the monitoring agency will ensure transparency Lafarge India has 11 million tonnes per annum cement capacity
Lauermann, however, downplayed the risk of job cuts, saying the plant recently added a third shift and as an employer it is the organisation’s duty to ensure that the jobs are safeguarded, even in difficult times.
But Volkswagen is downsizing elsewhere to maintain profitability, even as it tries to shrug off the effects of the emissions scandal that still weigh on sales. It has reduced the number of shifts at plants in Argentina, Russia, Mexico and Brazil, resulting in job losses in those places.
Volkswagen agreed to repurchase or fix about half-a-million vehicles in the US in an effort to tide over the scandal over using secret software to cheat exhaust emission tests. This clean-up act is estimated by some to cost as much as $10 billion. Cutting cost is one way to raise resources.
The troubles may spill over to India as the management told employees to brace up for the challenge as the In- dian plant is “not in a strong position place, either”. The Chakan factory employs more than 4,000 people. The India unit exports more than 50,000 units a year to Mexico, a market where it recently lost out on 2,900 units to Volkswagen’s Kaluga plant in Russia. With local sales remaining weak, the Chakan factory is surviving primarily on exports. Any dent to its numbers in a key export market like Mexico, even from another Volkswagen plant in a different country, will be a huge risk to the India manufacturing operations.
In the letter, the company said if the India unit loses any more production, its financial situation will come under the scanner and the operation may be questioned globally.
“It could eventually force us to come down from three shift operation to two and, in worst case, to a single shift operation. Needless to say, this will directly have an effect on our jobs here at the Pune plant, since a single shift production will require considerably lesser workforce,” it said. “This situation will withhold all our future investments and may also endanger the launch of our new compact sedan that is scheduled in the second half of 2016.” Apart from looking at improving efficiency year on year, the company is accelerating localisation. It has also been sending out a tough message to component suppliers. “If the schedules are not met and if it impacts the production, the vendor will be held accountable with a penalty, which can range in several hundred euros,” said one of the people in the know.
This was the second round of communication with the employees after a February 2016 meet where the management talked about issues of losing production to Russia and emphasised on maintaining quality, high standard of discipline and code of conduct.
While the dieselgate did hurt the brand globally, the Chakan plant has been ramping up production thanks to export demand and the upcoming compact sedan, Ameo. Volkswagen added a third shift to its operation and hired 800 more people. On March 29, the company crossed a critical milestone of 500 cars per day at the India factory.
Volkswagen said given the environment, it is extremely critical for each plant to show profitability to sail through this difficult time.
“There is already cut-throat competition in the automotive world and then there is some more across company’s different plants within VW world to grab every opportunity and to get more production volumes and utilise the respective production capacity in a better way,” the letter said.