New Delhi, March 30: The Supreme Court, while granting partial relief to automobile dealers across the country, came down heavily on India’s auto sector. During the course of the hearing, Justice Arun Mishra observed, “FADA just wants to take advantage of the lockdown. We cannot keep extending BS-VI deadline in the name of coronavirus”.
The court made it clear that there was no justification to extend a deadline set almost two years ago. The order was another reminder to automobile companies to think about the health of dealerships and allow actual retail numbers and not wholesale billing to be a barometer of growth.
The apex court had made it clear on October 24, 2018 that no BS-IV vehicle can be sold after April 1, 2020.
The dealers association told the Supreme Court bench that seven lakh two-wheelers, 15,000 passenger vehicles, and 12,000 commercial vehicles in the BS-IV category were in stock as of March 27, 2020.
Hero MotoCorp and HMSI argued before the court that COVID-19 created an unprecedented situation and dealers could not sell the stock due to the lockdown.
Both Hero MotoCorp and HMSI like a few others, continued making BS-IV vehicles till the middle of February, while several other players including Bajaj, TVS, Royal Enfield and Maruti Suzuki which stopped BS-IV production in January had manageable or no BS-IV stock.
Clearly, those who produced BS-IV products well into February are under greater stress today and their dealers are at the receiving end.
Officials at Hero MotoCorp and HMSI argue that they could have easily liquidated the BS-IV stock had it not been for COVID-19.