Petrol Stop - Auto Industry: Hiring & salary hikes to nearly double, this yr

Auto Industry: Hiring & salary hikes to nearly double, this yr

Sunday, 31 January 2010

01 Feb 2010;economictimes.indiatimes.com:Nandini Sen Gupta:NEW DELHI: The automobile industry has held steady on the growth track in India, and both hiring and salary hikes are likely to nearly double this year, riding on domestic demand and economic recovery. With the economic slowdown eating into growth last year, salary increases averaged 5-7%. This year, that count is all set to hit anywhere between 10% and 12%, taking the effective top end for high-fliers to 16-17%. The global slowdown did not bite companies in India too hard, though, and hiring continued on domestic demand for cars, SUVs and motorcycles. With the recovery kicking in, the situation can only get better. The industry’s fortunes have been helped by market leaders Maruti Suzuki (cars), Hero Honda (motorcycles) and Mahindra & Mahindra (utility vehicles) notching up good growth. “Maruti took a long-term perspective on people strategies during the downturn so we didn’t disturb salaries. Now with a strong recovery, our compensation packages will be aligned to the market and the performance of the company,” says SY Siddiqui, MEO (administration, HR, IT & finance). the company, he says, will take a call in June on the new structures but “it will be a strong double-digit figure very competitive over last year and the overall market.” Maruti was an exception with its 9.5% average wage hikes last year. This year, that should go up to around 11-12% on an average, which means the high-fliers can expect around 16-17% or more though the laggards could be stuck with last year’s industry average of around 6%, according to automobile industry experts. Maruti also added 725 people to its roster last year; this year, the figure will go up to around 940. Like Maruti, M&M too is looking to “significantly improve” the payout this year said Rajeev Dubey, president-HR, aftermarket and corporate services. “Last year, it was subdued, and in line with the industry average of 6-8%.” M&M will finalise its wage plans by August. “Hiring last year was not as intense as it will be now as the economic environment is emphatically better. Salaries will also be on the higher side this time around,” Mr Dubey said.