COVID-19 Lockdown: Maruti Suzuki Registers Loss Of Rs 125 Crore From BS4 Car Parts In India

India shifted to the new BS6 vehicle emission norms from the 1st of April 2020, amidst the COVID-19 pandemic. The lockdown which began in India on the 24th of March put an end to companies trying to sell off their remaining BS4 stock, ahead of the April deadline.

Unsold BS4 Maruti Cars In India Worth Rs 125 Crore Written Of As Company Loss: Confirmed By Company CFO Ajay Seth

The Supreme Court of India did give a brief extension of 10 days post the lockdown period. However, brands were allowed to sell just 10 per cent of their total BS4 stock. This was amidst multiple requests made by concerned authorities in the country.

Unsold BS4 Maruti Cars In India Worth Rs 125 Crore Written Of As Company Loss: Confirmed By Company CFO Ajay Seth

Maruti Suzuki, India's largest car manufacturer, has announced that they have now written off Rs 125 crore worth of unsold BS4 car parts in the Indian market. The number was confirmed by company CFO, Ajay Seth.

This amount includes the BS4 stock components which the brand's vendors and Maruti had in-house. It also covers the discounts offered on these components which were at 19,051 in the fourth quarter, compared to 15,124 during the same period last year.

Unsold BS4 Maruti Cars In India Worth Rs 125 Crore Written Of As Company Loss: Confirmed By Company CFO Ajay Seth

Vehicle dealerships were also given few options regarding their unsold BS4 inventory. This included registering it themselves and selling them off as used products, agree to a buyback policy with OEMs or send them for scrappage following the appropriate guidelines.

Unsold BS4 Maruti Cars In India Worth Rs 125 Crore Written Of As Company Loss: Confirmed By Company CFO Ajay Seth

Maruti Suzuki was one of the first brands in the Indian market to adopt the new emission norms for their cars. The company also announced the discontinuation of diesel, with only petrol-powered models going forward as well.

Unsold BS4 Maruti Cars In India Worth Rs 125 Crore Written Of As Company Loss: Confirmed By Company CFO Ajay Seth

The company introduced a BS6-compliant petrol engine in the form of a 1.5-litre unit last year. This engine now powers various models such as the Ciaz, S-Cross, Ertiga, XL6 and most recently, the Vitara Brezza.

Unsold BS4 Maruti Cars In India Worth Rs 125 Crore Written Of As Company Loss: Confirmed By Company CFO Ajay Seth

The 1.5-litre ‘K15-Series' petrol engine will also power the upcoming ‘Toyota Urban Cruiser'; a rebadged version of the Maruti Vitara Brezza, expected to go on sale in India very soon. This BS6-compliant petrol engine churns out 104bhp and 138Nm of peak torque.

It comes mated to a choice of manual and automatic transmissions, depending on the model and variant chosen. Maruti also offers their ‘SHVS' mild-hybrid technology along with the engine as well.

Unsold BS4 Maruti Cars In India Worth Rs 125 Crore Written Of As Company Loss: Confirmed By Company CFO Ajay Seth

Thoughts About The Unsold BS4 Maruti Cars In India

Although Maruti Suzuki introduced a number of BS6 models, well ahead of the deadline. However, they still had a number of BS4 car components which has remained unsold, due to the lockdown. We expect other manufacturers also to share their losses on BS4 inventory soon.

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Read more on: #maruti suzuki
Article Published On: Wednesday, May 20, 2020, 11:10 [IST]
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