Tata Motors is working on a voluntary retirement scheme (VRS) for 1,600 employees of its passenger and commercial vehicle businesses across locations and hierarchies, reports Mint.

Earlier, the company let go of excess staff with its Jaguar-Land Rover (JLR) business. The economic slowdown has hit the carmaker hard and it made aggressive cost cuts this fiscal, a source told the publication.

A second source said focus would be on reducing engineering staff, and contracts of some senior consulting staff may not be renewed. The third source added that 'headcount rationalisation' would also look at the R&D and engineering research teams in Pune.

Moneycontrol could not independently verify the report.

Tata Motors has the largest workforce in the industry, congruent to which its Q2 FY20 employee cost (as a percentage of net sales) doubled to 10.7 percent. Employee cost at Maruti Suzuki India, in contrast, was 4.9 percent, compared to 3.5 percent year-on-year.

The company’s move is par for the course as other motor majors such as Hero MotoCorp Ashok Leyland and Toyota Kirloskar also introduced similar schemes this year. The fast-approaching Bharat Stage VI (BS-VI) implementation deadline has added to its woes, the paper noted.