Indian automakers still have unsold stock worth Rs 5,633 crore of BS-III vehicles

After the Supreme Court ordered ban on sale and registration of BS-III compliant vehicles effective from April 1, automobile manufacturers in India started to offer heavy discounts to get rid of the existing stock. Even then, they have unsold stock of more than 140,000 BS-III compliant vehicles worth Rs 5,633 crore.

Also read: SC ban on BS III vehicles will cost the auto industry nearly Rs 12,000 crore

India’s leading commercial vehicle manufacturers, including Tata Motors, Ashok Leyland, Mahindra & Mahindra and VE (Volvo-Eicher), along with two-wheeler makers like Hero MotoCorp, Honda Motorcycle & Scooter India (HMSI) and TVS Motor Company, all have unsold inventory of BS-III compliant units across their outlets.

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After receiving the order on March 29, these automobile makers offered hefty discounts of upto 50% for remaining two days of March 31. The offers attracted several buyers, even as they made these companies suffer losses of around Rs 1,200 crore.

Now, they have two options left; either to export these vehicles to markets that still conform to BS-III norms, or to bring back the vehicles to factories and upgrade them to BS-IV standards. The latter, however, would be a much-expensive process as compared to the former.

(Image source M&A Critique)