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Covid-19, BS-VI transition take toll on automobile wholesale in March

The country’s largest two-wheeler maker Hero MotoCorp reported a 42% drop in sales during the month to 334,647 units of motorcycles and scooters. The company was already under pressure due to excess BS-IV inventory in the system, which it had to sell before 31 March. Production was further curtailed due to plant closures because of the nation-wide lockdown.

, ET Bureau|
Last Updated: Apr 02, 2020, 04.30 PM IST
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Mumbai: March was a washout month for the Indian automobile industry. Sales crashed across categories due to weak consumer sentiment and lower production on account of the transition from BSIV to BSVI emission standards and the nationwide lockdown to counter the Covid-19 pandemic.

The country’s largest two-wheeler maker Hero MotoCorp reported a 42% drop in sales during the month to 334,647 units of motorcycles and scooters. The company was already under pressure due to excess BS-IV inventory in the system, which it had to sell before 31 March. Production was further curtailed due to plant closures because of the nation-wide lockdown.

“In March 2020, the auto industry and the entire global economy has been faced with an unprecedented disruption, owing to the novel coronavirus. The COVID-19 has resulted in interrupted supply chains, halted production and lock-down, leading to no retails,” the company said in a media release.

Indian automotive manufacturers report wholesale numbers, which are sales to dealers and not the end sale to customers.

Premium motorcycle maker Royal Enfield too reported a similar fall of 41% over March 2019 to 35,814 units. The drop at TVS Motor Company was more severe at 55%. The company sold 144,739 units of motorcycles and scooters in March.

Company Mar-20 Mar-19 Change
Hero MotoCorp 334,647 581,279 -42.4
Royal Enfield 35,814 60,831 -41.1
Honda Cars India 3,697 17,202 -78.5
TVS Motor Company 144,739 325,323 -55.5
Ashok Leyland 2,179 21,535 -89.9


Japanese carmaker Honda’s India unit reported an almost 80% drop to 3,697 units during the last month.

“As is known, the last financial year was the most challenging for the automotive industry because of economic slowdown, poor consumer sentiment clubbed with transition challenges to BSVI,” said Rajesh Goel, senior vice president and director, sales and marketing, Honda Cars India Ltd. “In spite of the lockdown in March, we were able to almost achieve our annual business plan and also successfully liquidate the BS-4 stocks from the network.”

Leading commercial vehicles maker Ashok Leyland, meanwhile, reported a massive 90% drop in sales 2,179 units. Commercial vehicle makers were already facing slow sales due to an economic downturn and heavy price increases due to technology changes to comply with newer regulations.
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