Toyota halts work at 2 plants in India

Toyota said on Monday it has suspended production at its two Indian auto assembly plants in response to threats against management and "deliberate" assembly-line stoppages, as efforts to hammer out a labor deal failed.

The world's biggest automaker said the move will see about 6,400 employees locked out of factories in southern India.

Company and union officials had been trying to sign a new contract for the past 10 months, with the local government helping mediate negotiations.

"In the meantime, under the instigation of the union, certain sections of the employees have resorted to deliberate stoppages of the production line, abuse and threatening of supervisors, thereby continuously disrupting business for the past 25 days," Toyota said in a statement.

"All these unlawful activities have been detailed in the lockout notice. With this background, the company is left with no other option but to declare a lockout of the premises to ensure the safety of its workers and management personnel," it added.

Toyota Motor Corp spokesman Naoki Sumino said in Tokyo that there have been no injuries or damage at its two plants.

The spokesman said Toyota hoped to restart production quickly. But he could not give a time for the reopening of the plants, which make a range of models, including the flagship Camry sedan, the Corolla and the Prius hybrid.

The two factories, near Bangalore, produce about 310,000 units annually, Toyota said.

The issue comes as Japan looks to boost ties with India to counterbalance China's growing influence in the region.

Japan-India ties

But the experience of Japanese firms in India has not always been rosy.

In a 2012 riot at Maruti Suzuki's Manesar plant near New Delhi, workers chased supervisors with iron rods, killing a personnel manager and injuring close to 100 other managers.

The riot, which workers' representatives at the time said was caused by unhappiness over wages and working conditions, saw India's leading carmaker lock out workers for a month and cost Maruti about $250 million in losses.

Separately, Japanese pharmaceutical giant Daiichi Sankyo has struggled with its majority ownership of Indian drugmaker Ranbaxy since buying it in 2008.

Last week, Ranbaxy shares tumbled following news of a second recall of its cholesterol-busting generic drug. The company is already reeling from a string of US Food and Drug Administration import bans involving manufacturing safety worries.

The FDA has banned Ranbaxy from sending drugs and ingredients to the United States, its biggest market, from four of its plants for failing to meet "good manufacturing practices".

Earlier this year, Japanese Prime Minister Shinzo Abe went to New Delhi to push for closer commercial and strategic ties with India, as Tokyo seeks to offset Beijing's growing regional power.

Tokyo is a major investor in India, pumping in about $15 billion in the past dozen years and involved in building the Delhi-Mumbai Industrial Corridor, a $90 billion project linking India's capital with its financial hub.

AFP-AP