Tata Motors to offer VRS to select employees

Tata Motors Ltd has finalised a voluntary retirement scheme for select top employees of the company as part of an ongoing reorganisation plan, the company said. It, however, refused to divulge further details.

"Since the exercise for selecting L3-L5 is still underway, it is premature for us to comment on any other specifics at this point of time," a company spokesperson said in an email. The company has finalised the top two levels under the new management structure, the spokesperson said. It had 26,569 employees as on March 2016, according to its annual report. The company's employee cost in Oct-Dec was 8.45 bln rupees on a standalone basis. Tata Motors has been planning a revamp of its management since Guenter Butschek took over as chief executive officer and managing director last year. Butschek had said Tata Motors needed a new management structure to respond faster to market and customer requirements.

The new management structure will include relocating some employees to the company's Global Development Centre.

Analysts said the move to offer a voluntary retirement scheme will not impact the company's stock structure much. The move to cut costs will not impact the company as 90% of the company's stock valuation comes from its Jaguar Land Rover business, an analyst with a domestic brokerage.

The cut in workforce is aimed at reducing costs but will not impress investors, said an analyst at another domestic brokerage.