Samvardhana Motherson to undertake proactive cost optimisation measures

Samvardhana Motherson stock is in focus today and rose almost 5% after the company announced that they are undertaking proactive cost optimisation measures to improve operating efficiencies.

The evolving and dynamic automotive production environment, with increased complexity across the supply chain and regulatory uncertainties, is driving global volatility. To be prepared to operate in this evolving landscape and to breathe with the market, the company, via its subsidiary SMRP BV, has proactively initiated a series of transformative measures in Central and Western Europe.

The series of strategic measures would include various operational initiatives and active engagement and collaboration with the local workmen representative associations and will work on defining an optimization plan for adjusting and recalibrating the workforce in respective countries.

The proposed transformative measures will be implemented in a phased manner and will target optimization of a cost block of approximately. EUR 50 Mn per annum once fully executed over the next three years. The cost block under optimization includes various elements such as salary, benefits, overheads, cost of leased / contract employees, etc.

This transformative effort aims to address the changing supply chain landscape and implement necessary changes while ensuring uninterrupted customer supplies. The Transformation will be carried out in compliance with all applicable regulatory norms.