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Diesel Ban: Mercedes-Benz & Toyota extends financial help to dealerships

This cash flow is aimed at helping dealerships retain their employees and continue operations.

At this point, there’s no gainsaying that the ban imposed on diesel vehicles with engine capacity of 2,000cc and above in Delhi/NCR has been met with a strongly negative reception from all the prominent carmakers in the country. Apart from the usual repercussions, one of the side effects of this ban has been the financial problems it has landed car dealerships in. Thanks to the ban, these dealerships have seen sales dwindle in the region in the last few months.

To alleviate this difficulty a bit, Mercedes-Benz and Toyota are sending out sustainability packages to their dealerships in Delhi/NCR. This cash flow is aimed at helping dealerships retain their employees and continue operations. The finance support provided depends on the condition of the dealership.

Toyota is one of the carmakers hit the hardest by this diesel ban in the capital region. Delhi/NCR sales contributed 14 per cent to its domestic market. The company has faced a decline of around seven per cent of its annual sales as a result of this ban. Toyota has also put a stop on all future model launches in the country.

Speaking on the goodwill initiative, Shekhar Vishwanathan, vice chairman, Toyota Kirloskar Motors, said, "We have decided to support our dealers and have earmarked some cash flow to help them retain employees. We are carefully assessing the situation at our dealerships in the NCR and extending financial support as per their requirements."

Mercedes car, Toyota car

On the other hand, Mercedes-Benz has decided not to cut down on strength, but rather its employees’ roles in the company. The German auto giant has ten of its 83 outlets across the country in Delhi/NCR, which contributes to almost 20 per cent of their annual domestic sales. Mercedes-Benz has also put all further investments in India on hold.

Roland Folger, managing director, Mercedes-Benz India said, "We haven't cut down on our staff strength in Delhi NCR dealerships. A lot of their roles have been diversified, but there has been no cut in jobs. We have to wait and see what the next verdict holds for us".

SIAM, the apex automotive body in the country, too is unhappy with the government’s approach to diesel technology in the country. It says that this ban has resulted in the production loss of 11,000 vehicles and 5,000 jobs till April 30. It added that this ban will become responsible for total loss of a lakh vehicles and 47,000 jobs, if spread across the country.

In what might come as a small sigh of relief for carmakers, the Kerala HC has put a stay on the order to impose the same diesel ban in Kerala for two months. The ruling has been taken on the basis of a plea that the carmakers have not been given a chance to tell their version of story.

Source: CarDekho.com

( Source : deccan chronicle )
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