Rajiv Bajaj says vehicle makers must compensate dealers for unsold BS-IV stock

"Despite the impact of COVID-19 Bajaj expects to clear all of its BS-IV stock by the end of this week through a combination of strong and timely promotional interventions by the company, supported ably and equally through on ground activation by its dealers," he said.

Bajaj Auto on Tuesday launched a discount scheme for Haryana, Punjab and Rajasthan. The company is offering discounts between Rs 5000 and Rs 13,000 on BS-IV stock till 31st March. CNBC-TV18 learns from sources that the company's BS-IV stock is roughly around 25000 units.

Hero MotoCorp which has moved Supreme Court recently, is also offering discounts in the range of Rs 5000 -10,000. Sources at Hero MotoCorp say the company's BS-IV inventory is roughly 2 lakh units.

Speaking to CNBC-TV18, Nikunj Sanghi, Director International Affairs, FADA said, "It is difficult to give numbers at this point of time but the two wheeler inventory is definitely much higher than what could be liquidated in the current situation. We also expect manufacturers to support the dealers for the unsold inventory in a manner they deem fit so as to ensure that the retail business structure does not collapse. We are confident they will because they are concerned about the financial health and longevity of the dealers".

Both Hero MotoCorp and HMSI have moved court to seek a grace period to sell BS-IV stock and are urging the auto industry to support dealer partners during this lockdown period. However, other two wheeler majors have opposed the move stating that these companies are solely responsible for not being able to manage a smooth transition to BS-VI.