The most urgent need is to postpone the implementation of BS VI in order to give the automotive industry time to stabilize, opines K Srinivas Reddy, Managing Director, Veera Vahana Udyog (P) Ltd.
Impact on Business and Recovery Strategy
Our plant is still in a lockdown phase and unfortunately we do not have the option of working from home. As such, we have adopted a ‘wait and watch’ approach on this situation. These are very challenging times for the bus industry in particular. Our customers are all in bad shape. We are looking at how we can make buses safe for travel, especially AC buses. As for our future plans, all these years we were more focused on the private bus market but now we will start looking at state transport undertakings also and look at special application vehicles as we feel the bus industry is going to take lot of time to revive.
BS-VI Transition
I strongly believe this is not the right time for the introduction of BS VI in the country. When the telecom and power sectors can get extension of introduction of new standards by one year to April 1, 2021, I see no reason why such an extension cannot be granted to the automotive sector also. I strongly feel that SIAM could have done much more by meeting the prime minister and taking up the issue seriously. The BS VI transition for the bus segment is going to take lot of time.
Expectations from Government
There is a lot that the government can do for helping the bus industry, including announcing a tax holiday for a long time, waiver of interest, insurance rescheduling, reducing the insurance cost, etc. even after the situation returns to normal and till the time the passenger traffic improves. Most importantly, the government must delay BS VI by one year to April 1, 2021 as also introduce the scrappage policy immediately. This is a necessity for the industry’s survival and SIAM has to take it up with the prime minister. The final notifications on revised dimensions for all categories of vehicles must be notified immediately by the Ministry of Road Transport and Highways.
Outlook: Present and Future
If the above reliefs are provided then a lot of jobs can be saved and the industry can retain the current position for FY 2021 and provide good growth of at least 7-8% for FY 2022. If this is not done, we will see a huge loss of jobs running into lakhs and negative growth of at least 20-25% for FY 2021. The industry may not grow at all.
Medium to Long Term Impact
It will depend on what actions the government takes. If the government takes proactive steps and provides the industry with the reliefs requested, there will be quicker recovery. By chance if the government does not provide the reliefs requested for, it is going to have a devastating effect on our industry for a very long time.