It's been a long battle for the automotive industry to get profits going again and while it was thought that April 2020 would ease some of the burden, the coronavirus outbreak, shows clear indications that the dust is yet to settle. However, in a relief for the sector, the Supreme Court today eased the March 31 deadline for the sale of BS4 vehicles in India, giving an extension of 10 days, post the end of the lockdown period. Dealerships in the country are facing massive issues with sales over the 21-day lockdown period announced by the government of India and this does come as a relief. But the apex court has ruled that only 10 per cent, of unsold BS4 vehicles, can be retailed within 10 days after the lockdown ends and that means that the dealers will have a huge chunk of the inventory on their hands.
However, in a second judgement, the apex court said that those BS4 cars that have been already sold but not registered yet, will be given permission to register after the due date of March 31, 2020. This is a big relief, for all those customers as also automotive manufacturers who were not able to register their cars after the lockdown was announced.
Currently, the two-wheeler industry alone left with BS4 inventory worth ₹ 4,600 crore
The Federation of Automobile Dealers Association (FADA) and the Society of Automobile Manufacturers (SIAM) had moved the top court for extending the March 31 deadline for sale of BS4 vehicles. FADA argued that the sale of 15,000 passenger cars, 12,000 commercial vehicles, 7 lakh 2-wheelers are at stake due to, first the slowdown in the industry and the later the drop in footfall at showrooms due to the coronavirus pandemic. Currently, the two-wheeler industry alone left with BS4 inventory worth ₹ 4,600 crore, while dealers we left with an inventory of approximately 8,35,000 units. Furthermore, with the production being halted, the Society of Indian Automobile Manufacturers (SIAM) has already estimated a minimum loss of ₹ 2300 crore each day.