With BS 4 inventory still high, FADA continues to appeal SC for relief

BS 6 emission standards, set to come into effect from 1 April, 2020, will mean that no BS 4 vehicle will be legally sold or registered in India. This switch from the existing BS 4 norms to BS 6 standards is aimed at reducing air pollution which has reached an alarming level in India. In line with this, a number of automakers have started rolling out BS 6-compliant vehicles and will phase out BS 4 vehicles from their portfolio by April this year. But with roughly two months to go for BS 6 deadline, FADA wants the Supreme Court to allow sale of BS 4 vehicles even after the stricter emission standards’ implementation. This is because according to FADA, not all vehicle dealerships will be able to empty their stock of BS 4 vehicles by 1 April and could suffer financial losses. In fact, the federation even approached the apex court last month and filed a petition so as to allow dealerships to see BS 4 vehicles even after 1 April. 

FADA, in a release, noted that BS 4 inventory with automobile dealers is still high, making it difficult for them to sell BS 6 products. It further noted that the degrowth in December 2019 despite lucrative deals has made matters worse. As a matter of fact, year-on-year automotive sales decline were the worst last month, resulting in high BS 4 stock at dealerships. Of major concern for the federation is the BS 4 inventory in case of two-wheelers, which is still around 30 – 35 days as opposed to 21 days which is recommended by FADA. On a positive note, passenger four-wheelers’ average BS 4 inventory period came down to 20 – 25 days in December 2019 from 25 – 30 days in November last year. Going forward, it is hopeful that upcoming budget will include some new measures to revive the Indian auto industry.