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Wednesday, July 18, 2012

Dawn of a New Era: - Green(BSIV) HD Vehicles Are Finally Here

Dawn of a New Era: - Green(BSIV) HD Vehicles Are Finally Here

After prolonged confusion the entire country shifted to BSIII norms on Oct 1, 2010. Same time saw a shift from BSIII to BSIV for 13 cities across country. Seven more cities Puducherry, Mathura, Vapi, Jamnagar, Ankleshwar, Hissar and Bharatpur were added to list in 2012 taking the total to 20 now. The Union government plans to progressively introduce BS (Bharat Stage)-IV compliant norms in 50 more cities by 2015.

The shift from BSII to BSIII was very smooth and since then major volumes for any manufacturer are driven by BSIII Commercial vehicles. Literally 100% sales volume coming from BSIII vehicles coupled with high initial Investments on BSIV vehicles, the so called “Clean & Green Vehicles” never took off. Well after almost 2 years now though not by Choice but by Force these cleaner vehicles are coming on agenda of manufacturers.

Failure of this technology to take off has to blame the relaxation available to "National Permit" BSIII vehicles which can be registered in BSIV territories. Also the vehicles getting registered outside the Municipal Limits of BSIV cities need not be BSIV Compliant yet can ply with in the MC limits. This limits the requirement of the BSIV vehicles which are around 25% costlier than the existing BSIII product. To add to the vows the end user's mindset regarding the higher Spares & Maintenance cost is the highest contributing factor which restricts the acceptance of these "Green Vehicles".

As of now the only requirement popping up for BSIV vehicles is from Govt. tenders in BSIV cities which are asking for Cleaner vehicles to be inducted as per norms. Now the situation is such that the first one to enter the segment will have a clear edge over the late entrants.

As opposed to Passenger Car Segment where in any technological development is taken as a positive move and is accepted without much hiccups, CV industry is rather much more price conscious. Though we too witnessed a lot hue and cry over Hybrid Cars in same segment but the cost of acquisition for the same was approx 100% more as opposed to 25% in case of shift from BSIII to BSIV CVs.

BSIV CVs with different manufacturers across segments are at various stage of development. Few of them are even ready to hit to market sooner or later this FY.Tata Motors has recently applied for the STA approvals of its BSIV Diesel vehicles in 16T & 25T segment. These vehicles come with Common Rail (CRDI) technology and are poised to be more fuel efficient, command higher Power to Weight Ratio yet gentle on environment. 

Needless to say the coming time will decide the fate of this technology. It will be interesting to see the role of the Govt. in making the vehicles a mass market product. Will these vehicles come under special consideration and attract some incentives in the form of Excise Exemption or waiver of countervailing duties on import of special parts, remains a Question? 

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