The auto dealership fraternity is a worried lot following the crisis at Yes Bank.
Yes Bank being a prime lender to auto dealerships, could hitsmooth transition to the BSVI emission norms, which will be implemented panIndia from 1 April 2020. The automotive industry is currently in a phase toliquidate BS IV stock and fill its distribution channels with BSVI-compliantvehicles.
Dealers, looking to borrow fresh funds to buy BSVIinventory, are now worried about liquidity crisis from the capital-starvedbank.
Nikunj Sanghi, director, International Affairs at Federationof Automobile Dealers Association (Fada) told Mint that while on one hand theinventory is at its lowest in the market as BSIV stock is largely sold, dealersnow need funds to purchase BSVI inventory in March. “Dealerships with highdependency on Yes Bank are concerned about fund raising to buy the BSVI stockfrom vehicle manufacturers. Those dealing with Yes Bank will now facedifficulties in making payment for GST. If that is delayed then additionalinterest costs are levied on it.