CHENNAI/NEW DELHI/DETROIT -- Indian automaker Mahindra & Mahindra Ltd. expects to recall a large group of employees in North America after perviously cutting more than half the work force in the region.
The cuts were due to the COVID-19 pandemic and an ongoing legal tussle with Fiat Chrysler Automobiles, two people familiar with the matter told Reuters. Mahindra last month won a favorable ruling in the FCA case.
The people did not give a figure for the number of jobs lost at the business, which had more than 500 employees in early 2020, according to its website.
However, one of the people said "hundreds of workers" had been laid off since mid-2020 as part of a restructuring, and that the cuts were as high as two-thirds of Mahindra Automotive North America's total staffing. Positions included engineers and manufacturing jobs at its plant in Detroit that produces the off-road vehicle Roxor, as well as sales executives.
The company said in a statement it had furloughed some staff and laid off others due to the pandemic and an International Trade Commission lawsuit which led to an August "cease and desist" order for the Roxor business. It did not provide figures.
Mahindra and FCA are in a protracted legal battle over an intellectual property infringement case which prevented the Indian automaker from selling its Roxor vehicle in the U.S.
"This forced us to halt production and furlough our manufacturing team and some additional people across several functions, including the Roxor sales team," the company said.
But last month, the favorable ruling in the FCA case paved the way for it to begin selling the new, redesigned Roxor.
It now expects to recall a large group of employees, it said in the statement.
The cuts came as Mahindra reviewed its businesses in a drive to conserve capital and retain only those that make money or have the potential to be profitable.
As part of its review which began last year, Mahindra has pulled the plug on its U.S. electric scooter business GenZe; it is in talks to sell its stake in South Korean automaker Ssangyong Motor; and it has called off a joint venture with Ford Motor Co.
A Mahindra Group spokeswoman in India said the company will stay firm on implementing capital allocation norms, with a sharp focus on financial returns, driving growth and continued improvement in international subsidiaries.
"MANA has been evaluating options for making the organisation leaner and optimising performance and productivity," she said, adding that the company's Detroit center will continue working on new electric platforms and is preparing for the launch of the new Roxor 2021.
The automaker plans to focus on manufacturing large SUVs and EVs for its core India market, where it has lost ground to competitors such as Tata Motors and Kia Motors.
