The Auto Writer

The Ford Flex is just one of several vehicles sidelined due to labor strife in India.

What happens half a world away does, indeed, impact other people. A case in point is a problem which has surfaced lately in India, the world’s largest democracy, as a labor strike and civil unrest are affecting a key parts supplier for General Motors and Ford. Both automakers have had to shut down production plants in Canada and the United States due to strife in a faraway land.

Rico Strike

Rico Auto Industries, with headquarters in Delhi, has been marred by a strike since September 21st, as workers responded to disciplinary action meted out by company officials against sixteen of their fellow workers at one plant. That strike has forced GM to shut down one of two production shifts at its Warren, MI transmission plant and has led to the temporary closure of the company’s SUV factory in Delta Township, MI. Its large Buick Enclave and GMC Acadia crossovers are built at that factory which employs some 2700 workers.

Rico also supplies parts for Ford’s crossovers vehicles including the Ford Flex, Ford Edge, Lincoln MKX and Lincoln MKT. Those vehicles are built at the company’s Oakville, Ontario plant which shut down on October 26th due to a component shortage. According to Rico’s website the company manufactures fuel systems, cylinder head covers, clutch assembly and brake discs, though neither Ford nor GM has identified what parts they source from Rico.

The Rico plant had been operational since the strike began with some 1700 of its 3000 workers electing to stay on the job. However, violence erupted a week ago resulting in the death of one person, resulting in roused workers blocking factory gates and disrupting production.

Indian Commitment

Both Ford and GM have issued statements recently to underscore their respective commitments to all of their Indian suppliers including Rico Auto Industries which was founded in 1984. As global automakers, the two companies source components from around the world with India being a multi-billion dollar producer of automotive parts.

Still, any sort of shut down is reason for concern which means that a quick resolution of the conflict is critical to ensuring that the supply chain remains strong.

Tata Troubles

GM and Ford aren’t the only automakers who have had trouble doing business inside of India. Tata Motors, one of India’s largest auto producers had to shift production of its super cheap Tata Nano away from the state of West Bengal when protesters stepped up their attacks against the company.

Local farmers claimed that the state unfairly took land away from them for Tata’s benefit, which stopped the facility from going forward. Tata later canceled the plant and has since built a new one in the state of Gujarat which welcomed the automaker’s move.

Though West Bengal is under communist rule, the state of Gujarat has had its problems too. As recently as 2002, some two thousand Muslims were massacred at the hands of Hindus, the dominant religious group in India.