Hero, TVS, Bajaj Oppose Govt Over Electric 2-Wheeler Plan; Auto Stocks Crash Over Uncertainty
The Government of India has made yet another attempt at implementing vehicles that are powered by electricity in the country, in which it has been pushing automobile manufacturers to present a plan of the transition within a very limited time frame of 2 weeks only.
This has been received with extreme criticism by the popular automobile manufacturers and suppliers of India, viz. Hero MotoCorp, Bajaj Auto and TVS Motor Co., and they have expressed their bitter objection for the forced transition.
To know the reactions of the automobile manufacturers of India, read on!
Hero MotoCorp, Bajaj Auto and TVS Motor Co. Object Strongly
The India federal think tank, Niti Aayog, has advised all two and four wheeler manufacturers to draft and present a plan that will show the outline of the process of transition of vehicles from the conventional fuels to electric. Niti Aayog has also warned that if this decision is met with opposition, the court will interfere in this matter.
To further boost this movement, the Ministry of Road Transport and Highways announced that electric vehicles will not be required to pay road taxes for registration of a vehicle, or even the registration of the vehicle.
Hero MotoCorp, Bajaj Auto and TVS Motor Co are India’s top automobile makers and all three have firmly protested against the Government’s initiative, saying that a complete transition from conventional automobiles to electrically powered ones is a change that is difficult to incorporate.
The manufacturers have criticised the move by saying that the transition is “not like Aadhaar, not software and print cards”, and that a lot of factors need to be taken into account. TVS Motor Co-Chairman & Managing Director Venu Srinivasan expressed his distress, saying, “You have to set up a whole supply chain, and migrate from the current supply chain.”
Hero MotoCorp also said, “An abrupt and sudden changeover will disrupt the entire eco-system of vendors, OEMs, dealers, spare parts manufacturers, and mechanics, as well as other stakeholders, thereby impacting the livelihoods of millions of people dependent on the industry.”
Niti Aayog plans to ban completely the two-wheelers that are equipped with ICE (Internal Combustion Engines) which are of up to 150cc. Hero MotoCorp also said that the company is worried about the after-effects that will be there if this does happen in the future.
Auto Stocks Decline After Niti Aayog Announces Plans
This declaration not only incurred the wrath of the automobile manufacturing companies, but also brought their market prices down.
After Niti Aayog declared the two-week deadline, the shares of automobile companies such as TVS Motors and Bajaj Auto saw a downfall in their market shares. During the trade, the Nifty Auto Index fell down by 1.35 per cent.
TVS Motors saw a decline of 4.5 per cent, Bajaj Auto declined by 2.04 per cent, and Hero MotoCorp went down by 1 per cent.
Apparently, the auto sales are seeing their worst time ever in two decades, which means that this is truly a bad timing for the Niti Aayog to announce such plans.
Should Niti Aayog still go ahead with its plan to ban IC engine-powered two-wheelers completely? Let us know in the comments section!