A month before pulling the plug on producing BS-IV models and a couple of months before completely switching over to BS-VI, market leaders Maruti Suzuki India and Hero MotoCorp have offered huge discounts on vehicles running on the older emission technology.
Car market leader Maruti is offering discounts of up to Rs 89,500 before it stops selling diesel models and prices on BSVI go up. Hero MotoCorp, which sells every second two-wheeler in the country, has also doled out grand offers. Depending on the model and where it’s being bought, the benefits to Hero buyers, including discounts of up to Rs 5,000, could be around Rs 10,000, a Hero spokesperson said.
Shashank Srivastava, executive director, sales and marketing at Maruti Suzuki India, said average discounts (depending on the model, fuel type and region) were Rs 15,000-20,000 lower than what were offered in December. He said it was time for the buyers to make the most of the offer, as the price hikes the firm announced in December take effect in 10 days.
Maruti said brisk sales during festivals and in December due to discounts helped the company cut its stock levels to 10-12 days — the lowest in a year. “The whole of this financial year, we have been battling to bring down the stock levels. There have been days when it has risen to 50 days. It’s important for the dealers as it is one of the significant cost components for them apart from manpower,” Srivastava said. Therefore, he said the current stock level gave the firm a lot of comfort.
Srivastava, however, remains cautious in his outlook. “We have to see how the market absorbs the price increase. All the factors responsible for slowing auto sales, including the high cost of ownership, steeper cost of borrowing, etc, remain. It is difficult to predict anything,” he said.
Maruti is likely to halt production of BS-IV models by the end of this month. It still continues to produce the Brezza diesel.
Owing to the price sensitivity of the segment, two-wheeler makers have a bigger challenge with regard to the switchover.
“There is residual BS-IV inventory of limited models in some markets across the country on which the company is running a limited ‘2020’ offer. This offer may be supplemented by dealers,” a Hero spokesperson said.
Hero has started sales of BS-VI models and is “aggressively ensuring the availability of BS-VI products across the country,” the spokesperson said. The prices of the BS-VI models are Rs 7,000-8,000 higher than the BS-IV variants.