Eicher Motors tumbled 8.14% to Rs 14,387.20 after the company said it has decided to suspend the operations at various plants starting Monday, 23 March 2020, till 31 March 2020.In light of the unprecedented situation owing to the spread of COVID-19 and various advisories shared by the government, the company's management has decided to suspend the operations at various plants starting Monday, 23 March 2020, till 31 March 2020.
This will include manufacturing facilities in Pithampur, Baggad, Bhopal and Thane. Also, company offices and company owned dealerships operating in affected districts of the country have been closed for the same period. However, during this time, the firm scaled down activities to address the customer concerns and emergency services will remain operational.
VE Commercial Vehicles (VECV)'s priority is the safety and well being of all employees, and casual and temporary workers. The company employees will continue to work-from-home during this time frame. VECV will continue to monitor the situation closely and take appropriate action as per government and administrative guidance.
In a separate announcement, the company said that Royal Enfield has suspended all operations globally, starting Monday, 23 March 2020, till 31 March 2020. This will include the company's manufacturing facilities across Tiruvottiyur, Oragadam and Vallam Vadagal in Chennai, technical centres across Chennai and at Bruntingthorpe, Leicestershire in the UK, and all company offices and company owned dealerships in India.
Royal Enfield has further issued advisories to all dealerships in India to shut down for the same time period, or follow local administrative orders, as may apply. This has been done keeping in mind the safety and well being of all employees, and casual and temporary workers. During this time period, company employees will continue to work-from-home, and there will be no salary deduction for any permanent or temporary employees or workforce, and no reduction of workforce.
Depending on concerned local jurisdiction and restrictions ordered, Royal Enfield's roadside assistance facility, service centers and workshop facilities are likely to be impacted during this period.
Royal Enfield will continue to closely monitor the situation and take appropriate action as per regulatory and administrative guidance.
Meanwhile, as of 20 March 2020, Royal Enfield has successfully cleared all existing inventory of BS-IV motorcycles across channels and dealerships.
Shares of Eicher Motors hit its 52-week low at Rs 14,144.95 during intraday trade.
Eicher Motors' consolidated net profit fell 6.4% to Rs 498.70 crore on a 1% rise in net sales to Rs 2,350.45 crore in Q3 December 2019 over Q3 December 2018.
Eicher Motors is the listed parent of Royal Enfield, the global leader in middleweight motorcycles. In addition to motorcycles, Eicher has a joint venture with Sweden's AB Volvo - Volvo Eicher Commercial Vehicles (VECV) - which operates in India's commercial vehicle space. VECV has a complete range of trucks and buses from 5-55 tonnes, and its integrated manufacturing plant in Pithampur, Madhya Pradesh is the global hub for medium duty five- and eight-litre engines for Volvo Group.
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