Fiat India seems determined to set its house in order before launching the latest version of Palio.
The company has signed a new wage agreement with employees working at its Kurla plant, in Mumbai.
According to the new agreement, employees will receive an increment in monthly wages in the range of Rs 1,300-2,300, depending on the number of years of service.
The agreement also includes a provision for further modernisation of working systems, whereby employees will achieve quality standards by "self-certification" at each working stage.
This involves maintenance of tools, machines, and other equipments by the workmen themselves.
The company and employees have also decide to rev up operations by adopting innovative methods of working.
These methods are aimed at reducing cycle time and wastage, and making optimum use of raw materials.
Sources said Fiat is also planning to make India the hub for exports to other South-East Asian countries. Hence, the company has decided to pump in fresh capital to revive the ailing Indian operations.
Sources said the move would dispel rumours that Fiat is planning to exit India.
Fiat India, which re-entered the Indian markets in September 2002, employs 2,000 people.
It manufactures the Palio, Siena, Adventure and Weekend series of cars at its Kurla plant.
A new version of its flagship model, the Palio 1.2 petrol, is scheduled for launch by the end of August 2003.
Features incorporated in the new Palio have been based on customer feedback, Fiat's experience with the Palio in other markets, and in-house research and development.