How is the job/salary cut situation at car dealers & OEMs? | Car Dealer Tracker: Car Dealers Review & Rating site | Share your Experiences here

How is the job/salary cut situation at car dealers & OEMs?

The current coronavirus pandemic has seen every industry suffer, right from the IT sector to retails. Having said that, the automobile sector has also taken a big plunge, and the losses curtailed are quite staggering too.

 

Cars is a premium product and the price of each model is way higher than other life-style defining things. Obviously, the lockdown has brought the sales to almost zero and there was nothing that could help the dealers fight the crisis.

 

The end employees are also among the line of fire. With the shutters down on the sales completely, the dealerships have zero revenue, thereby affecting all the liabilities and payment it has to make.

 

Car Dealer Tracker has spoken to a couple of dealer owners and some dealer employees.  One of the biggest concerns for employees is the pay cut. Though not completely removed from the pay scale, a lot of the dealers are just paying 50% of the salaries to the employees, which would have a huge impact on them during the time of crisis.

 

Besides just that, a lot of the dealers have even gone to the extent of paying only 30% of the salary for the non-working days.

 

A few of the dealerships are paying the salaries of the employees in full. However, the main clause that they are following is that there would be deductions in the salary in installments post the lockdown.

 

Dealers are not laying off important employees, like the back-office workers or salesmen, as it would be troublesome or hire them back post corona, also there is recruitment cost involved. However, the ones who occupy the not-so-important roles are being laid off. Also, dealers have their own business projection for the next six months, considering the current situation and post corona effect, which as per them might last till September 2020, in any case in automotive sales, summer and monsoon months are considered dull. Dealers want to trim the manpower after evaluating all these factors.

 

A lot of automakers have come up with funds to help the dealerships sustain through this tough period. Most of them are even negotiating with banks to waive off the interest until the situations are under control.

 

Plus, dealers like Maruti Suzuki, Skoda, Hyundai, Ford, etc., are taking care of certain financial obligations of the dealers and have sanctioned funds towards it. Hence, the problems at the dealers’ level might not end up being severe if the OEMs and automakers step in with assistance.

 

 

CDT tried contacting the HR department of OEMs, at a few places query went unanswered, some requested anonymity and shared the details. Though the steps taken at the OEM level aren’t affecting the end employees directly, they still quite grave. To start with, the automakers have:

 

  • Put new hiring of employees at hold, including replacements.
  • Promotions and salary hikes on hold until things get back to normal.

 

However, the OEMs aren’t laying off or cutting the salary of any employee, going slow on all the above-mentioned activities.