As a nation, we are under a 21-day lockdown in our fight against something which has the World in its grips. Every citizen, except for those without which the World simply cannot do, has been asked not to step outside the door and for all the right reasons. In this situation, there exists a lot of confusion about some pressing issues and although we hope these will be addressed in the coming days, we also hope that sense prevails when these matters are up for consideration. One of these is the BS4 to BS6 emission norms transition, which was to be completed on the 1st of April 2020.
Prior to the current situation, the auto industry in India witnessed one of the worst years in terms of both growth and sales. On top of that, they had to adhere to the Government’s dictat of upgrading their entire portfolio to conform to the new norms. Although a necessary step to clean the air we breathe, this transition required resources and investments at a time when all of them were already facing gusty headwinds. Closer to the enforcement date for BS6 norms, a lot of BS4 inventory (worth approximately INR 6,400 crore) is still unsold and lying in stockyards. The Federation of Automobile dealers did knock on the doors of the Apex Court to consider extending the date of implementation so that existing stock could be cleared. Their request returned without cheer.
As of now, attempts are being made to approach the court again and bodies like the SIAM have involved themselves for the court to consider the plight of the dealers. While unsold inventory is one problem, the other issue is that of people who have bought vehicles in the past few days and are awaiting registration. The trouble is, according to the order passed by the Court, no BS4 vehicle can be registered after the 31st of March, 2020. Given the current situation, there is no way a vehicle can be registered. Also, unsold inventory will have to be scrapped or recycled if it does not find any takers (which it won’t now) before the 31st of March.
The Government has announced that it will announce measures in the coming days which will try and soothe the economy which is taking a big hit from this pause. Given the fact that the auto industry is one of the biggest contributors to the nation’s GDP, we hope the current situation finds a solution which makes all those involved breathe a little easy. In our opinion, the date of implementation for the new norms can be moved forward by some time to mitigate the losses which would be otherwise incurred by dealers, customers who are still awaiting registration for their cars, and the auto industry in general. Although these are tough times and we’ve been asked to distance ourselves socially, the need to be considerate of each others’ needs is extremely important. That’s the only thing which will help our boats sail across these choppy waters.