FADA want to sell and register BS-IV vehicle after 1st April
Published On Dec 20, 2019
Concerned over the viability of dealerships business, the unlikely scenario of unsold inventory of BS-IV vehicles after the deadline set by the Courts, FADA believes this will adversely impact its members who operate on tiny profits in remote parts of India and eventually forced to shut shops.
The Federation of Automobile Dealers Associations (FADA) on behalf of its members filed an impleadment application in the Supreme Court of India along with a petition seeking a modification in Apex Court’s decision to ban the sell of BS-IV vehicle after March 31, 2020.
Speaking on this decision, FADA President Ashish Harsharaj Kale said, “With the current timeline of all India BS-VI fuel availability of 1st April’20, most manufacturers will shift to 100% BS-VI vehicle production only by end February’20 or 1st week of March’20. Looking at this timeline of BS-VI production and the current fluctuating demand situation, despite putting in the best of efforts, there is a possibility that many of our members are not able to ensure 100% liquidation of BS-IV inventory purchased by them in the course of business before the deadline of 1st April’20 fixed by the Honourable Supreme Court.
According to FADA, its members range from large dealership groups to family-run small scale dealerships operating in the remotest corners of the country and are working on 3%-5% gross margins of the cost of the vehicles. Despite their best efforts to sell, if dealers are left with an inventory of BS-IV on the 1st of April’20, many of them will face financial hardships that could even threaten the existence of their business.
FADA has appealed to the Apex Court to protect the inventory and in turn, the dealership survival of our members and allow us to sell and register inventory purchased before 1st of March’20, which remains unsold by the 31st of March beyond the current deadline of 1st April’20.”
Founded in 1964, Federation of Automobile Dealers Associations (F A D A), is the apex national body of automobile retail industry in India engaged in the sale, service, and spares of 2/3 Wheelers, Passenger Cars, UVs, Commercial Vehicles (including buses and trucks), and Tractors.
F A D A India represents over 15,000 automobile dealers having 25,000 dealerships including 30 Associations of Automobile Dealers at the Regional, State, and City levels accounting for 90% of market share in India. FADA claims to have nearly 2.5 million direct employees and another 2.5 million as indirect employees, making it a total of ~5 million people in the country at dealerships and service centres.