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Supreme Court gives carmakers 10-day window after lockdown to sell BS 4 stock

  • According to FADA, around 17,250 BS 4 cars, and 14,000 commercial vehicles of BS 4 remain unsold till date.

The Supreme Court has allowed sale of BS 4 vehicles for ten days after lifting of the ongoing lockdown over Coronavirus. The top court has relaxed its earlier March 31 deadline for sale and registration of BS 4 vehicles.

According to the Supreme Court, the Indian carmakers can sell only 10% of their BS 4 stock during this period. However, the top court's ruling does not include the Delhi-NCR region.

The ongoing coronavirus lockdown will end on April 14, provided the government does not decide to extend this further under the current circumstances.

The Indian auto industry will go through a major transition in the days to come. While the industry has been preparing for the BS 6 shift for quite sometime now, the recent coronavirus outbreak has added unforeseen burden on auto dealers since the whole country is under a lockdown state.

According to the latest estimates, the unsold two-wheeler inventory of BS 4 vehicles in the country has been calculated to range in between 6,00,000 to 8,00,000 units, and these vehicles are valued at close to 3,600 crore.

(Also read: How coronavirus has started hurting car dealers in India)

Facing difficulty in clearing BS 4 vehicle stock as sales has dipped over Covid-19 outbreak, auto dealers had earlier approached the Supreme Court seeking extension of the deadline to register vehicles running on older emission norms.

Two-wheeler major Hero MotoCorp has approached the Supreme Court seeking extension of the deadline for sale or registration of BS 4 vehicles by three months.

FADA had filed an application in the apex court earlier as well with the prayer for an extension of registering BS 4 vehicles in wake of huge unsold inventory and slowing sales. That application was, however, rejected by the court on February 14.

"Post our initial application, there has been a drastic change in circumstances in conducting business as usual. SARS-CoV-2 a.k.a coronavirus (COVID-19) which emerged in Wuhan in the Hubei province of China has spread rapidly across the globe and also in India," FADA President Ashish Harsharaj Kale said.

"Following this in the past week there has been drastic drop in sales and customer walk-ins have reduced to a trickle as caution sets in due to fear of spreading of the Virus. Counter sales has fallen by 60-70 per cent across auto dealerships in these past few days," he added.

The Society of Indian Automobile Manufacturers (SIAM) had said that it has approached the Supreme Court seeking directions for ensuring sale and registration of BS 4 vehicles are allowed till the cut-off date of March 31st, 2020.

According to SIAM, the cut-off dates ranges from February 29, 2020 to March 25, 2020 from state to state, though the BS 6 Emission compliance is mandated from April 1, 2020.

(With inputs from agencies)

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