Dealers ask companies to take back BS3 vehicles


NEW DELHI: Automobile dealers have asked companies to take back unsold inventory of Bharat Stage 3 (BS3) vehicles -worth Rs 12,000 crore -if the Supreme Court and green authorities do not permit their sale from April 1.

The retailers, represented by the Federation of Automobile Dealers Association (FADA), said a refusal to take back the previous-generation vehicles (an inventory of nearly 9 lakh units) will be catastrophic for their business and result into large-scale losses and even closure of many retail points.

FADA has sent an urgent missive to auto industry body Society of Indian Automobile Manufacturers (Siam) as well as to Tata Motors and Ashok Leyland, the two manufacturers which have a large amo unt of BS3 inventory lying in the market.

“With the new developments that have happened in the Supreme Court and the fact that a ruling to not sell and register BS3 vehicles from April 1 could be one of the outcomes of the legal process, I would urge you to agree on a consensus within Siam on the return of unsold inventory lying with our members,“ FADA president John K Paul said in the letter. FADA said it has received “numerous representations“ from its members on the issue.“There is a sense of panic and nervousness among our members,“ the dealer body said, adding that the move could have a “disastrous financial impact“ on the dealers.

The issue of BS3 inventory has become a major headache for many auto companies, as some manufacturers like Bajaj Auto and Daimler’s BharatBenz have broken ranks and are bat ting for sale of only the cleaner and more efficient BS4 vehicles.

Those in support of sale and registration of BS3 inventory even after April 1 include companies such as Tata Motors, Mahindra & Mahindra, Ashok Leyland, Hero Moto, Honda Motorcycle and Scooter India (HMSI), TVS as well as Siam.

The confusion stems from the fact that, while a 2015 notification from the road transport and highways ministry spoke about mandatory manufacturing of BS4 vehicles from April 2017, it made no mention of whether the sale of BS3 inventory would be allowed. In October last year, the Supreme Court-mandated Environment Pollution Control Authority (EPCA) directed vehicle manufacturers that no nonBS4 vehicle will be registered after April 1.