Hero MotoCorp says the company will not be able to meet all its obligations amid COVID-19 lockdown.
Amid COVID-19 lockdown in the country that has affected businesses, Hero Moto Corp, India's largest two-wheeler manufacturer said since sales are down due to the coronavirus shut down, the company will suspend full payments to its vendors adding that it has no other option amid the current crisis situation. Hero said that it will not be in a position to meet all the obligations. India is under a 21-day lockdown period after PM Modi announced it on March 24 forcing thousands of companies to suspend its operations including manufacturing, production, sales as dealers have also shut down.
"In this situation, we are left with no other option but to invoke force majeure and regret to inform that HMCL will not be in a position to meet all its obligations," Hero informed The Economic Times. The company said sales of vehicles falling under the BS-4 and BS-6 category did not pick up at dealerships and the situation is likely to continue till mid of April, pushing the company to take such decisions. However, even in the current circumstances, the company said that it is trying its best to make full and on-time payments to large number of MSMEs and small vendors to support its stakeholders.
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Prime Minister Narendra Modi announced the lockdown on March 24 (Tuesday) asking people to remain indoors as it was important to maintain social distancing if India wanted to escape from a major crisis if it fails to contain the virus. India COVID-19 confirmed cases toll has surged to over 1,100 including 25 deaths and going by the current trend, the numbers are likely to rise in the coming days.
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