Auto dealers find way to clear BS-IV stock

More two-wheeler dealers are resorting to this measure than car and commercial vehicle dealers due to the comparatively large number of unsold BS-IV scooters and motorcycles, the executives said.

Several automobile dealerships across India have registered a large number of unsold Bharat Stage-IV (BS-IV) vehicles under proxy owners to sell them eventually in the pre-owned segment, said executives at several dealerships.

People walk past parked autos and cars in a parking during an extended nationwide lockdown to slow the spread of the coronavirus disease (COVID-19) in New Delhi. (REUTERS)

More two-wheeler dealers are resorting to this measure than car and commercial vehicle dealers due to the comparatively large number of unsold BS-IV scooters and motorcycles, the executives said.

The dealers were unable to clear their inventory before the Supreme Court’s deadline of April 1 because of the nationwide lockdown, they said. The dealers now plan to sell the pre-registered BS-IV vehicles in the open market once the lockdown is lifted and the markets recover, the dealers said, requesting anonymity. The vehicles are however, likely to fetch the dealers around 30% less than new models because of their pre-owned status and other costs, suggested people Mint spoke to.

In October 2018, the Supreme Court ruled that no motor vehicle conforming to the BS-IV emission norms can be sold or registered in the country from April 1. In March, the SC provided relief by allowing dealers to sell 10% of the BS-IV stock after lockdown.

“Re-registration of new unused vehicles to sell them as used vehicles adds up to a significant cost burden on the dealers,” said a Hyundai Motor India dealer based in Pune. “To re-register the vehicle, one has to pay the road tax again, which ranges from 8% to 21%,” said a Jaipur-based dealer.