Auto companies lose 12,000 diesel car sales on NGT order

Over 12,000 diesel cars would have been sold in National Capital Region (NCR) between last Friday, when the National Green Tribunal (NGT) passed order banning registration of such cars, till January 6, 2016, the next date of hearing of the issue, industry sources said.

The lost sales include the already booked ones, they said.

Automakers are opposing the NGT directive, alleging they were not taken into confidence before the order was passed.

The NGT move came as second jolt to car makers after Delhi government's proposal to ration road use by allowing odd and even-numbered cars number on alternate days to tackle rising pollution in the national capital.

Vishnu Mathur, director general, Society of Indian Automobile Manufacturers (SIAM), told dna, "It's not correct to blame only diesel cars for environment reasons. The decision should be holistic. This is a sudden order which has been made without consulting us. The Delhi pollution is largely due to city climatic conditions and very less due to diesel engines."

Diesel car majors including Mahindra & Mahindra, Tata Motors, Hyundai, Toyota, Renault would be hit most by the NGT decision. Industry sources said the car manufacturer would not be able to sell a single diesel vehicle till the next hearing.

Delhi- NCR contributes nearly 12% to passenger vehicle sales in India, of which diesel vehicles accounts for 30% of the total sales in the city, according to SIAM data.

Pawan Goenka, executive director of M&M, said in a conference call, "This is injustice for the entire sector. What is the logic of banning vehicles compliant with BS-IV norms, which were made mandatory in October in certain states."

NGT has directed that no new diesel vehicles would be registered in Delhi, and vehicles older than 10 years should be phased out completely. The diesel car maker view this as a major challenges ahead for consumer who are clueless on delivery of their booked vehicle.

Rakesh Srivasatva, senior vice-president for sales and marketing at Hyundai Motor India, told dna, "This sudden judicial directive has created concerns among buyers towards delivery of their vehicles, for which payment has already made. The government also needs to look at the diesel inventory at dealerships, which raise concerns towards the cost of inventory and its future."

"We reserve our comments as the decision is pending with the government and the courts. However, the government should give serious view to create a robust roadmap for the automobile industry. The industry has already made plans to invest in diesel technology as per BS-V norms to be implemented by 2019, and such decisions can negatively impact the sector," he said.

SIAM is also quoting the IIT-Kanpur study that says that passenger cars are responsible for only 2.5% of the pollution in Delhi. "The air quality in the city deteriorates every September and gets better in January. This is the normal climate cycle of Delhi for last 10 years,"said Mathur.

In line with SIAM view, Pawan Goenka said, "BS-IV vehicles are contributing only 0.5% to the total particulate matter (PM) 2.5 load in Delhi. In the last 15 years PM has come down by 82% and mono-nitrogen oxides (NoX) by 51%. PM will further come down by another 80% from the current levels by the time BS-V is implemented."

As per a transport ministry notification, the BS-IV norms would be mandatory for four-wheeler vehicles manufactured on or after April 1, 2017.