CHENNAI (Reuters) – Honda Motor Co is offering voluntary retirement to employees of its motorcycles and scooters unit in India amid slowing demand in the country following the COVID-19 pandemic, a company letter shows.

The Honda logo is displayed at the 89th Geneva International Motor Show in Geneva, Switzerland March 5, 2019. REUTERS/Pierre Albouy/Files

Honda Motorcycles and Scooters India (HMSI), the country’s second-largest manufacturer of two-wheelers, made the offer to “maintain its existence” in a competitive market, it said in a letter to its employees’ union dated January 5.

“The Indian auto industry is going through an exceptionally challenging phase considering the prolonged demand slowdown and economic fallout from the coronavirus crisis,” HMSI said in the letter, which was reviewed by Reuters.

“In these uncertain times, we are aligning our production strategy for improved overall operational efficiency with the objective of long term business sustainability,” it said.

HMSI did not immediately respond to an email seeking comment.