Hero Electric Dealers Demand Rs 500 Crore in Pending Payments, Stage Protests at HQ

Hero Electric is facing a significant conflict with its dealers, who are demanding payment of pending dues totaling approximately Rs 500 crore. Over 200 dealers have staged protests outside Hero Electric's headquarters in Gurugram, alleging that the company has not made payments to them for the past two years. They claim to have paid more than Rs 150 crore in advance for the supply of electric scooters, but Hero Electric has not fulfilled its commitments, leading to substantial financial strain on the dealerships.

Escalating Dispute

The dealers accuse Hero Electric of not delivering the ordered scooters and failing to provide warranties for spare parts. This situation has left around 50,000 customers without proper service and warranty support. Dealers have taken the matter to the Prime Minister, seeking intervention to resolve their grievances. The financial stress has been so severe that some dealers have considered extreme measures, including suicide, due to the lack of batteries and chargers needed for sales.

Subsidies and Customer Backlash

Under the FAME-II policy, subsidies were supposed to be passed on to end customers, but dealers claim these have not been reimbursed. This has led to a backlash from customers who are dissatisfied with the lack of service and support for their vehicles. Nishant Bansal, a Delhi-based dealer and President of the World Federation of ZE EV and Welfare Association, stated that dealers have incurred massive debts and are demanding immediate compensation and resolution of the warranty and spare parts supply issues.

Legal Actions and Court Involvement

The Delhi High Court, along with the Punjab and Haryana High Court, has admitted petitions by Hero Electric against the Ministry of Heavy Industries, seeking recovery of pending subsidies amounting to over Rs 550 crore since 2021. This legal battle adds another layer of complexity to the ongoing dispute between the company and its dealers.

Hero Electric Management's Response

Hero Electric management has denied the allegations made by the dealers. A meeting was held with the dealers at the company headquarters, but no agreement was reached on the outstanding dues. According to Bansal, the management dismissed the claims as false and mischievous, telling dealers to "do whatever you want" regarding their demands. A spokesperson for Hero Electric stated that the production shutdown over the last nine months has caused delays. However, production has resumed, and vehicle dispatch has begun, with a commitment to resolving open issues by December 2024.

Conclusion

The ongoing dispute between Hero Electric and its dealers highlights the challenges faced by the company in fulfilling its commitments amidst production delays and financial constraints. The resolution of these issues is critical for restoring trust between the company and its dealers and ensuring customer satisfaction in the rapidly growing electric vehicle market.