The deadline for manufacturers to meet the new BS6 emission regulations is set for March 31, 2020, and the big challenge for manufacturers and dealers will be to clear off the existing inventory of BS4 vehicles before the stipulated date. Citing concerns over unsold inventory, Maruti Suzuki Chairman RC Bhargava said that manufacturers and dealers will have to work together to sell and register diesel cars before April 1 next year. The Maruti boss was speaking at a press conference for announcing Q4 financial year results.
BS4 vehicles will be deemed illegal to be sold after the deadline, which could lead to big losses for both automakers and dealers. The key part here is that the registration for BS4 vehicles - both petrol and diesel - needs to be complete before April next year, which will be a task given the current decline in the buyer sentiment.
Mr. Bhargava suggested that corrective measures will have to be taken with respect to production and sales to clear existing stocks of BS4 vehicles. The last three quarters in FY2018-19 have been a lull for the Indian auto industry and dealers have already raised concerns over the piling up inventory, especially for two-wheelers that were said to be at alarming levels in March 2019, according to the Federation of Dealers Association (FADA).
Currently, diesel engine models constitute about 22-23% of the total sales of @Maruti_Corp . The 1.5 litre diesel engine newly launched on the #MarutiCiaz could be the only diesel engine on offer. The company has no plans to invest/develop new diesel engine cars. pic.twitter.com/VUkg8jB0NA— carandbike (@carandbike) April 25, 2019
The next few months are also expect to see auto sales struggle to grow with the ongoing general elections. Domestic sales have usually seen a drop around the election season in the previous years as well. However, with the uncertainty towards fuel prices with the ban on oil import from Iran and the hike in prices due to new safety regulations, are few reasons why sales will be sluggish in the current quarter. Maruti Suzuki has also altered its growth predictions for the financial year and expects to grow between 4-8 per cent in terms of volumes.
Big news coming in from @Maruti_Corp . "From April 1, 2020, we will not sell any small diesel engine cars." R C Bhargava. India's biggest market will phase out 1.3 litre diesel engines in the next one year. pic.twitter.com/KM8oZGDK1J— carandbike (@carandbike) April 25, 2019
In addition, Maruti Suzuki also announced that the brand will be phasing out its 1.3-litre diesel engine by April 2020, while the 1.5-litre diesel that recently debuted on the Ciaz will be its new mainstay oil burner. It's not clear as to which cars from the current line-up will get the new diesel motor. The company also suggested that it will be shifting its synergies towards petrol vehicles for the BS6 emission norms. The company's 16 petrol vehicles and their variants will be up upgraded to meet BS6 regulations, while the Super Carry LCV will be discontinued with the diesel variant, with only the petrol and CNG versions to continue.
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