Tata Motors Cuts Up To 1500 Employees As Part Of Restructuring Exercise
Sameer Contractor
1 min read
May 24, 2017, 07:47 AM
Key Highlights
- Tata said it has cut up to 10-12% employees from its managerial level
- The restructuring exercise was initiated to bring more accountability
- Tata Motors reported a lower consolidated revenue for FY2017
Having announced Voluntary Retirement Scheme or VRS for its employees recently, Tata Motors said that it has reduced its managerial workforce domestically by 10-12 per cent as part of an organisational restructuring exercise. The Indian automaker declared its financial results for the fourth quarter of 2016-17 and that's where the company Managing Director and CEO Gunter Butschek spoke about the reduction in workforce.
Speaking at the event, Butschek said, "The reference on which we started was in the vicinity of 13,000. We do see as far as the white collar population is concerned, an overall reduction in the vicinity of 10-12 per cent." The 10-12 per cent workforce equates to around 1500 people out of the total 13,000. Tata also clarified that only the white collared personnel were affected by the VRS, and the blue collared workers have not been impacted by the exercise.
Tata Motors also revealed that the affected employees were given the option of voluntary retirement, while some retired or resigned. Certain employees were also moved to new roles within the company and the others were transferred to the company's services arm - Global Delivery Centre (GDC), something we told you about earlier this year. The latter works on a contractual basis for the automaker and does not bring the employees on Tata's payroll. The number of employees transferred to GDC wasn't though.
Gunter Butschek further said that the past year was about getting the strategic direction right. The company identified the possibilities of restructuring and that started with the aim to reduce managerial levels. From the previous 14 levels, the automaker is now operating on five core levels, along with the executive directors, presidents and Managing Director. The move was seen as an effort to increase accountability in an organisation as big as Tata Motors, especially with the automaker reporting lower net profit.
For the fourth quarter of the 2016-17 financial year, Tata Motors reported a lower consolidated net profit of Rs. 4336 crore, downy by 17 per cent as compared to Rs. 5211 crore reported in the previous fiscal. For the year ended March 31, 2017, the Consolidated revenue (net of excise) was Rs. 269,850 crores against Rs. 273,111 crores for the last year. The manufacturer reported a net profit of Rs. 7557 crore, a drop of 35 per cent of the previous year.
Meanwhile, Tata's British brand Jaguar Land Rover reported a 13 per cent increase in sales and 10 per cent hike in revenue. In standalone business, the M&HCV and LCV showed de-growth last year in the commercial vehicle space, while the passengeer vehicle segment was able to show some growth backed by three launches - Tiago, Hexa and Tigor.
Speaking at the event, Butschek said, "The reference on which we started was in the vicinity of 13,000. We do see as far as the white collar population is concerned, an overall reduction in the vicinity of 10-12 per cent." The 10-12 per cent workforce equates to around 1500 people out of the total 13,000. Tata also clarified that only the white collared personnel were affected by the VRS, and the blue collared workers have not been impacted by the exercise.
Tata Motors also revealed that the affected employees were given the option of voluntary retirement, while some retired or resigned. Certain employees were also moved to new roles within the company and the others were transferred to the company's services arm - Global Delivery Centre (GDC), something we told you about earlier this year. The latter works on a contractual basis for the automaker and does not bring the employees on Tata's payroll. The number of employees transferred to GDC wasn't though.
Tata's passenger vehicle segment grew last year backed by three new launches
For the fourth quarter of the 2016-17 financial year, Tata Motors reported a lower consolidated net profit of Rs. 4336 crore, downy by 17 per cent as compared to Rs. 5211 crore reported in the previous fiscal. For the year ended March 31, 2017, the Consolidated revenue (net of excise) was Rs. 269,850 crores against Rs. 273,111 crores for the last year. The manufacturer reported a net profit of Rs. 7557 crore, a drop of 35 per cent of the previous year.
Meanwhile, Tata's British brand Jaguar Land Rover reported a 13 per cent increase in sales and 10 per cent hike in revenue. In standalone business, the M&HCV and LCV showed de-growth last year in the commercial vehicle space, while the passengeer vehicle segment was able to show some growth backed by three launches - Tiago, Hexa and Tigor.
Related News
Popular Tata Models
Latest Cars
Upcoming Cars
Trending News
Latest News
car&bike Team | Dec 14, 2025Top-Spec Tata Sierra Accomplished, Accomplished+ Prices RevealedRegardless of the powertrain combination chosen, all Tata Sierra Accomplished+ trims cost upwards of Rs 20 lakh (ex-showroom).2 mins read
car&bike Team | Dec 13, 2025Skoda Slavia Facelift Spied Testing Again Ahead Of DebutThe facelifted Slavia is expected to debut in 2026 as Skoda-VW India looks to refresh its India 2.0 range.1 min read
car&bike Team | Dec 13, 20252026 MG Hector Facelift Interior Previewed Ahead Of DebutLatest teaser video of the upcoming Hector facelift suggests minimal cosmetic changes to the interior as well as reveals a new alloy-wheel design.1 min read
Jaiveer Mehra | Dec 13, 2025Passenger Vehicle, Two-Wheeler Sales Surge In November 2025: SIAMBoth segments reported a growth in the region of 20 per cent, though year-to-date sales growth in FY2026 was notably flatter at around 3 per cent.1 min read
car&bike Team | Dec 12, 2025Nissan Entry MPV Design To Be Unveiled On December 18New MPV to be the first of three new models for India by Nissan, alongside the Tekton and a three-row SUV.1 min read
Jaiveer Mehra | Dec 12, 2025New Mini Convertible Launched At Rs 58.50 LakhDrop-top variant of the iconic Cooper hatchback available in a single Cooper S spec.1 min read
Janak Sorap | Dec 11, 2025Harley-Davidson X440 T First Ride Review: Smarter and SharperHarley-Davidson has taken the X440 and given it a more focused and engaging twist. The result is the X440 T—essentially the same platform but updated in areas that give the motorcycle more appeal and riders more thrill.5 mins read
Shams Raza Naqvi | Dec 10, 20252025 Mini Cooper Convertible Review: More Colour On Indian RoadsThe updated Mini Cooper Convertible is set to be launched in the Indian market in the next few days. We drive it around Jaisalmer for a quick review.1 min read
Bilal Firfiray | Dec 8, 2025Tata Sierra Review: India’s New Favourite?Marking its return after a few decades, the reborn Sierra has made everyone sit up and take notice. But is it worth the hype?10 mins read
Girish Karkera | Dec 4, 20252026 Honda Prelude First Drive: Domesticated Civic Type RA sporty-looking coupe built to give customers a taste of performance but not at the expense of everyday practicality.5 mins read
Seshan Vijayraghvan | Nov 29, 2025Mahindra XEV 9S First Drive Review: Big Electric SUV, Bigger ExpectationsThe XEV 9S lands at a time when the EV crowd is growing fast. It’s a big, born-electric, three-row SUV that starts under 20 lakh. It sits close to the XUV700 in size, but the brief is very different. Here’s what it’s like on the road.11 mins read