Hyundai’s threat to shift production of the i20 to Europe is a big bluff (‘Hyundai to shit i20 production to Europe’, May 9). If the i20 is to account for 40 per cent of the company’s exports to Europe, do you seriously think the company will shift it to Europe where it will need to set up another production line only for this? The reason why Hyundai came and set up i20 facilities here was due to certain cost and other efficiencies — India’s labour costs are around an eighth those in Europe. Indian officials who are negotiating with Hyundai would do well to ask the company how much the car will cost if it is to be produced in Europe.
India’s labour laws, it is true, could do with a lot of improvement, but much of this applies only to companies that are trying to close down their units — so this does not apply to Hyundai.
India’s cost advantages have not gone away due to a short strike.
Sudhir Shah, Mumbai
