Motorcycle dealers in India grapple to sell pending BS4 inventory worth 2,500 crore

 Motorcycle dealers in India grapple to sell pending BS4 inventory worth 2,500 crore

Covid-19 or Corona Virus that took the entire globe by storm shutting down every activity that is carried out causing irreplaceable mayhem

The major markets of the countries remain close as the virus is communicable with possibly no solution on it. Although there is news that few states may have found out the answer to it.

However, in India, the lockdown has been ordered until 21 days from today.

The Indian Motorcycle market is primarily affected by two things.

  • Corona Virus and
  • The deadline for the BS 4 vehicles is getting over in March 2020.

Now that does mean essentially we should BS6 vehicles on the road in India from April 2020.

How Corona lockdown has affected?

However, we come to know from Auto Economics that over 2,500 crores BS4 inventory is still pending with the dealerships despite giving massive discounts on the motorcycles.

The fact that dealers are shut due to Corona has added more pressure on selling the pending BS4 motorcycles.

There are various dealers who still have BS4 stock with them like Hero MotoCorp, Honda Motorcycle and Scooter India, TVS Motors, and even Bajaj Auto.

Also, companies such as Hero MotoCorp, Honda Motorcycle and Scooter India and dealer association FADA has requested the supreme court to extend the March 2020 deadline.

The pending inventory is mostly from states like UP, Haryana, Karnataka, Punjab, Maharashtra, Gujarat, and Delhi.

If we need to count on numbers approximately 4.5 to 5 lakh units, BS 4 vehicles are still unsold, and they are with dealers. Which again is enormous no.

Quotes

“We are simply saying that give us at least three months to sell the stock which is already in the market.

No fresh BS-IV stocks are being produced, or dispatched,” Niranjan Gupta, CFO of Hero Moto, told TOI. Till last week, the company had a stock of around 2 lakh units.

YS Guleria, senior VP at HMSI, said that over 90% of the retail network is currently shut. “Things are tough, and no one knows when the lockdown will be lifted.”

“It is a very challenging situation, and things have evolved quite fast. The escalation of lockdown was not anticipated by anyone,” Hetal Gandhi, director at Crisil Research said.


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Akash Dolas

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