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Limited Production Starts At Manesar

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Maruti Suzuki, India's biggest carmaker, resumed limited production at its Manesar plant shut down by labour unrest on Monday, a company statement said, as the firm hopes to begin talks with workers to end strikes that have cost over $330 million in lost production.

Maruti, 54.2-per cent owned by Japan's Suzuki Motor, has suffered a production loss of over 50,000 cars this year due to labour unrest which culminated last week when workers took control of its Manesar plant.

A supporting strike at a neighbouring Suzuki Powertrain plant, which builds engines for the carmaker, halted supplies to Maruti's other plant in Gurgaon, forcing the 2,800 cars a day factory to close.

"We will be talking with the workers today and have started limited production at Manesar," a Maruti spokesman told Reuters, adding that production at the Gurgaon plant was also restarted but would be dependent on engine supplies.

Maurti has started operations at its Manesar weld shop with some trained workers from among those who have refused to join the strike, the statement said.

The losses compound the woes at Maruti, which saw a 21-per cent drop in September sales as rising interest rates andvehicle costs hurt demand in the world's second-fastest growing major auto market after China.

The state government of Haryana, where the plants are located, was brokering the talks between Maruti and the workers, the spokesman said.

Authorities declared the sit-in strike illegal last week, forcing the workers out of the plant. The striking workers are demanding the reinstatement of sacked former colleagues.

Maruti had said it would not compromise with the workers, whom it has accused of deliberately sabotaging production and breaking an agreement signed last month.

Shares in the carmaker were up 2.8 per cent at 1,056 rupees ($21.54) after news of the production restart at 0530 GMT on Monday, against a 0.2-per cent fall in Mumbai's benchmark index.

Maruti shares have fallen more than 27 per cent in 2011, under performing a nearly 20-per cent fall in the broader market.


(Reuters)


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