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Crisis in auto sector deepens as several OEMs delay payments to suppliers

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NEW DELHI: As automakers had to stop vehicle production unexpectedly due to the covid-19 pandemic, a number of them prioritized payments to their employees, permanent and contractual, but had to delay payments to suppliers of components, mostly small and medium scale industries.

Most of these manufacturers are in the commercial vehicles and two-wheeler space. Commercial vehicle manufacturer Volvo Eicher Commercial Vehicles has decided to delay payments to some suppliers for the time being and invoked force majeure.

The company, though, has decided to pay their permanent and contractual employees instead. India's largest two-wheeler manufacturer, Hero MotoCorp, though did a u-turn and decided to extend the bill discounting facility to pay

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