Louis Vuitton store in Singapore. Image courtesy: Reuters
Four years after choosing Puducherry for its first manufacturing plant in Asia, French luxury goods giant Louis Vuitton has decided to sell its Indian unit to a Chennai-based firm.
Part of the euro 20 billion Moet Hennessy Louis Vuitton group, the French company's Indian back office subsidiary is known as Les Ateliers De Pondicherry (LADP). The new owners of LADP are likely to be Leather Crafts India, sources said. Louis Vuitton's decision to sell the unit comes as a blow not only to Puducherry's reputation but also to India's image as a competitive cost destination. The prospect of a change of management sparked labour unrest with the 200-odd Indian employees on LADP's rolls going on strike since June 13 demanding that the firm regularize their services before winding up its operations and handing over the unit to the new owners.
LADP has two plants—one in Kurumbapet here and the other in Perambai in Tamil Nadu—to manufacture leather components for Louis Vuitton products. The management made a formal announcement about exiting India on June 13, which triggered the labour problem. Sources said that LADP was set up jointly by Louis Vuitton and the Puducherry-based leather fashion brand HiDesign. HiDesign did not take a stake in LADP but Louis Vuitton took a 5% stake in HiDesign. Messages to HiDesign CEO Dilip Kapur went unanswered.
LADP, which had regularized the services of its administrative staff, had not confirmed the 240 workers on its rolls in the last four years.
Author: Bosco Dominique & Nandini Sen Gupta
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