Toyota to suspend more than 5,000 workers in Argentina

The decision to lay off personnel was taken by the company to compensate for the losses incurred due to the drop in sales

August 01, 2019 by Peoples Dispatch

On July 29, Japanese automotive manufacturer, Toyota, announced that it will suspend more than 5,000 of its workers working at the plant in Zárate city, in the province of Buenos Aires, Argentina. In addition, the company also announced that it will implement the time bank model, the most resisted measure in the labor reform bill proposed by President Mauricio Macri’s administration in 2017. The step has been taken to compensate for the losses incurred due to the drop in sales and they have thus decided to slow down its production.

As per the time bank measure, the number of hours not worked by each employee will be counted and recovered on Saturdays when the demand grows. The critics say that the measure eliminates the payment of overtime and is a disguised extension of the eight-hour working day, one of the most significant historical conquests of the labor movement.

On the other hand, the step highlighted the brutal impacts of the economic crisis in Argentina. Despite the subsidy introduced by the government to encourage the sale of automobiles, the automotive industry has been hit hard by the crisis.

Toyota has been manufacturing and selling cars in the country for more than 20 years. Months ago the company had informed the staff that every month it would assess the demand and adjust the production rate according to the pace of sales. It first slowed the production of the manufactured stock from 160,000 units to 140,000 units. Now, it has decided to further slow it down to 130,000 units.

According to a report by the Public Policy Observatory of the National University of Avellaneda (UNDAV), the utilization of installed capacity in the automotive industry has been the lowest this year in the last 15 years.

(With information from Info Gremiales)

× To Subscribe