Tata Motors cuts 1,500 top-level jobs as part of restructuring exercise

Tata Motors cuts Top Level Jobs


In a rather surprise move, Tata motors has announced that it has cut down 1,500 posts at its managerial level. The company has attributed the move to its organisational restructuring exercise at the domestic level. The announcement came as Tata motors announced its Q4 financial results o Tuesday.

Tata Motors cuts 1,500 top-level jobs

Around 10  to 12 per cent of the 13,000-strong workforce will be bereft of their jobs as a result. Speaking at the Q4 and annual performance review, Guenter Butschek managing director and chief executive of Tata motors said, “The reference on which we started was in the vicinity of 13,000. We do see as far as the white collar population is concerned, an overall reduction in the vicinity of 10-12 per cent.”

The move comes in the wake of similar mass firing by IT, banking & finance firms across India, to accommodate the job requirements of a more international workforce. The jobs cut is also being seen as a part of the company’s recently announced Voluntary Retirement Scheme (VRS). However, Tata motors made it clear that the VRS scheme would not impact blue collared workers and was meant to be implemented only on white-collar personnel.

While Tata Motors’ British arm, Jaguar Land Rover reported a 13 per cent increase in sales and 10 per cent increase in revenue, the parent company itself reported a downfall of profits, both in the fourth quarter and its year on year revenues. The Q4 profit for Tata Motors was Rs 4336, a 17 per cent decrease from the Rs 5211 reported last year for the same quarter. Similarly, its annual consolidated revenue was Rs 2,69,850 crores in comparison to Rs 2,73,111 reported in the previous financial year.

According to a report by PTI, the company’s group chief financial officer, C Ramakrishnan called the layoffs a ‘holistic fundamental review’ and said, “We underwent a very detailed exercise in terms of the roles, the requirements and the fitment of the roles etc. It was a very comprehensive exercise which we rolled out over a 6-9 month period which also factored in performance and leadership qualities.” The target has been to bring in ownership and accountability within the top levels of the organisation.