COVID19 or the Coronavirus has caused a total lockdown of the countries worldwide. This has given the auto industry a setback as the automakers were already facing issues while finishing their BS4 stocks. BS6 deadline was set for the April 1st, 2020. Supreme Court has given an extension to the BS6 deadline adding 10 days. But this seems of no help to the industry. Why? Read here.
- The customers are not going to step out of their homes to buy a vehicle amidst the lockdown. Thus the 10 days are going to pass within the lockdown period.
- There is a BS4 stock worth of ₹4,600 crores with the two-wheeler companies. The dealer inventory tallies to 8.35lakh units.
BS4 Stock Worth Crores Piled Up | BS6 Deadline Extension Of Any Help? - Society of Indian Automobile Manufacturers (SIAM) has estimated that the industry is bearing a loss of ₹2,300 crores per day as the production is suspended during the lockdown.
- It may be noted that only 10% of the total stock is what the companies can sell during the extended period.
Plants Shutdown Due To Coronavirus - The automobile industry was already facing a decline in the demand of commercial as well as the passenger vehicles. The epidemic will only add to the sorrow.
- Furthermore, the cost of vehicles which will comply to BS6 emission norms is going to be more than the BS4 models. This will surely have an adverse effect on sales.
- Even after the lockdown period, the industry does not expect a sudden surge in the demand as the vehicles won’t be the first thing a person would plan to buy.
Thus the 10-day extension in the BS6 deadline is not at all going to help the industry at all. The companies have been taking measures such as extending the service period and warranty period for the customers. Will the government do the same for the industry? Or will the industry have to deal with the upcoming distress all alone?
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