Maruti Suzuki to hire 2,000 workers for Manesar 3rd line

However, other sources in the company indicated that while the conversion may be possible for the fewer employees at the relatively newer Manesar plant (started in 2007), the process would take much longer for its first Gurgaon facility and in all probability miss the March deadline. Though contract workers get lower pay and lesser job benefits, they make up the bulk of the labour force today — in the Gurgaon plant only 40% of the workers are permanent.

With a 50% wage hike announced last September (average monthly pay is Rs 38,000), combined with the conversion of over 5,000 contract workers to higher-paying permanent positions, over Rs 100 crore is expected to be added to Maruti's current wage bill. Though company officials including CFO Ajay Seth have previously said that the impact on financials will be minimal, employee expenses as a percentage of net sales is likely to cross 3%, a number similar to that at Hero MotoCorp. At present, Maruti's wage bill is among the lowest in the industry at 2.2% (of net sales) at the end of the third quarter of this fiscal, lower in fact than the 2.3% of the previous fiscal.

Maruti has fared better this fiscal in terms of sales on the back of rising popularity of its diesel models such as the Swift, Dzire and Ertiga. Despite sluggish demand for petrol cars and a production drop owing to labour troubles, Maruti's volumes in April-December rose 8.36%compared with a 11% drop in FY12.

An improved product mix and better export realisation has led to an almost two and half times jump in net profit to Rs 501.29 crore for the December quarter. The company's share ended Monday at Rs 1,593.50 on the BSE, down 0.94%.

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