How will BS VI fare for the Indian automobile industry, wonders Siddharth this month
THE TRANSITION TO BS IV EMISSION NORMS across India on April 1, 2017 was nothing short of a potboiler! The auto industry had petitioned the court to accept its version of the interpretation of the government order – that mandated the shift. The industry said the order implied that only BS IV vehicles would be manufactured from the said date, while sales of BS III stocks may continue. But as far back as September 2016, the EPCA (Environment Pollution Control Authority) had warned that the order was meant to see a complete stop of all BS III vehicles by then – including sales and registration too. The EPCA was set up at the behest of the Supreme Court and eventually ruled – just two days before the deadline, that the date was absolute, and that any left over stock must be sold by the industry before April 1. We saw discounts and mayhem like it was a double-Diwali – with schemes ranging from 10 to 25 per cent off the price of some bikes to even free bikes being given with larger ones from the same brand.
All this is well and good. And you can choose which side you agreed with or didn't. But the court’s order was very clear. It also justified the fact that there were two deadlines (April 1, 2016 for all-new models to be launched as BS IV only, and a year later for existing models to transition). And in all the manufacturers got time from March 2014 when the order had first been issued. So the real question that emerges now – and one I am watching keenly – is what will happen with the next emissions cycle leap that India wants to make. It was once again the Supreme Court that ruled last year that India leapfrog Stage V norms and go straight to BS VI – on April 1, 2020. That is a whole 5 years before the initial deadlines set years ago. And this time there is just one deadline for a nationwide switch. The move will also no doubt take the March 29, 2017 ruling as precedent and that is why I called the next deadline absolute. This means there is unlikely to be any ambiguity on what the deadline means. Manufacturing, sales and registration of BS IV vehicles will not be permitted post March 31, 2020.
So why could this be messy? Well the EPCA’s directive, which the court has agreed to enforce, is definitely a step in the right direction to really tackle the pollution issues the country faces. But in order to begin switching car, bike and truck models to BS VI, the industry would need to begin introducing them in the months preceding the deadline. And that means BS VI fuel would need to be available almost a year earlier – according to SIAM (Society of Indian Automobile Manufacturers). It also says the earliest we could get BS VI compliant fuel is September 2019 – and that is also debatable as oil companies have not still committed to one date. This does not give the industry enough time to make the transition by April 1, 2020, says SIAM.
So we are not out of the woods – or courts for that matter – as yet. The issue is a thorny one and while it has great intent at the heart of it – needs proper resolution and understanding to ensure a smooth transition. By smooth I don’t just mean for the industry and all stakeholders – but mainly for you – the consumer. After all, BS VI compliant vehicles are likely to be a tad pricier. Let us not forget the safety norms that are also coming into play starting October this year – which will make all cars at least crash ready and carry more safety equipment as standard. That is already going to add to prices anyway. And the industry is ready from a tech point of view anyway – most models in India are global ones (or based on global platforms). And many manufacturers export Euro VI (similar to BS VI) compliant vehicles already. So making the same kinds of vehicles for India will not be the big challenge. The question is of whether dates and deadlines can be honoured realistically. So does that mean I would prefer deadlines for emission control to be extended indefinitely? Absolutely not. Instead I would look to the government to offer us a clear picture of exactly when the state-run oil companies will actually be able to supply BS VI fuel. Because that is going to be the real test for our capability to make this transition. And I do hope we get clarity sooner than later. ⌧
‘We saw discounts and mayhem like it was a double