Around 200 dealers of Hero Electric held a protest in front of the company’s headquarters in Gurugram on Wednesday, demanding the pending payment of around ₹500 crore to them, and this negligence has also left around 50,000 customers in vain.
The dealers have also written to the President, Prime Minister, Niti Aayog, Finance Minister and the Minister of MSME against Hero Electric, alleging that the company has failed to provide vehicles and the warranties for spare parts, resulting in around ₹100-crore worth of warranties still pending with the company.
“In the last year alone, our members have deposited more than ₹150 crore into their accounts (Hero Electric) for vehicle purchases. More than ₹150 crore of the entire dealer network across India were taken in advance to supply e-bikes to dealers. However, the company has failed to provide the vehicles and the warranties for spare parts,” said a letter dealers sent to the Prime Minister.
Dealers’ anguish
According to a Delhi-based dealer, Hero Electric has supplied the vehicles without batteries and chargers, after taking the full amount from them. None of the EVs are being sold because of no battery and chargers, and existing customers are also attacking the dealers because of no servicing of the EVs that were sold earlier.
“Some of the dealers have also attempted suicide because they are in huge debt...due to mismanagement within the company, production was halted nearly two years ago, and parts for warranty are not provided, leaving many unserviced e-bikes at our dealerships and worsening the situation,” Nishant Bansal, a Delhi-based dealer told businessline.
Bansal, who is also the President of World Federation of ZE EV and Welfare Association, said that dealers are now asking for an immediate reimbursement or compensation for the financial losses incurred by dealer members and provision of the outstanding warranties and spare parts for the affected vehicles.
He said there are around 600 dealers who are affected by this and therefore requested the Centre to intervene in the matter for the reimbursement and provision of the outstanding warranties and spare parts for the affected vehicles.
“We want resolution of the supply issues to ensure that the 50,000 Hero Electric vehicles can be made roadworthy, aligning with the government’s vision of promoting electric mobility,” the association said in the letter.
Hero Electric’s denial
Hero Electric in its response said a meeting was held at the Hero Electric office in Gurugram with the dealers and some people have, in the heat of the moment, tried to extract immediate solutions during which a statement purporting to “claims of ₹500 crore pending towards dealers was made, which is patently false and mischievous”.
“Dealers have separate agreements with the company, based on their sales estimates. Production shutdown for the last nine months has caused delays; however, the company has already started production, and dispatch of vehicles has already commenced with a commitment to the dealers to resolve open issues by December 2024,” a spokesperson at Hero Electric told businessline.
It may also be noted that the Delhi High Court and Punjab and Haryana High Court have admitted petitions by Hero Electric disputing the actions of the Ministry of Heavy Industries and sought recovery of pending subsidies to the tune of over ₹550 crore since 2021, the spokesperson said.
“These are subsidies passed on to end-customers as per the FAME-II policy and not been reimbursed to the company till date. Since the matter is sub-judice, the irresponsible statements made by a section of the people at the meeting is being responded to with a legal notice, categorically denying the statement and their allegations,” the spokesperson added.