Vehicle Scrappage Policy 2024: Get Up To Rs 20,000 Discount On Your Next New Car

Carmakers have agreed to offer discounts if you scrap your old, polluting car, but there are some important conditions. Read on to know more…

In the recent meeting with SIAM, Transport Minister Nitin Gadkari said that automakers have agreed to offer discounts on new car purchases if you scrap your old car

But before you get too excited, here’s what you should know:

1. As per news reports, the discount will be either 1.5% of the ex-showroom price of the vehicle, or Rs 20,000 whichever is lower, against the scrapped vehicle. 

2. The vehicle must have been scrapped in the last 6 months. If it was scrapped earlier, you will not be eligible for the discount. 

3. The offer will be valid only for a limited period of 1 year. However, carmakers may choose to extend or modify the offer as they deem fit. 

4. Although reports suggest that automakers such as Maruti Suzuki, Tata, Mahindra, Hyundai, Kia, Honda, Toyota, VW, Skoda and MG have agreed to offer these discounts, we’re still awaiting official confirmation from these brands.  

5. Mercedes-Benz has reportedly agreed to a flat discount of Rs 25,000, which is higher than the maximum discount of Rs 20,000 mentioned earlier. 

There are some other incentives for scrapping your old car as well:

• Scrap value given by the scrapping centres: You could get up to 4 to 6% of ex-showroom price of a new vehicle.

• Vehicle registration fees to be waived off on new cars.

• State governments are also expected to offer concessions up to 25% on motor vehicle tax.

But, these scrappage benefits are only available to private vehicles older than 15 years. If you wish to keep your car post 15 years, it will need to undergo a mandatory fitness test. If your vehicle fails the test, you will be allowed one re-test after making necessary repairs, failing which the vehicle must be scrapped out. 

Also Read: Considering Buying a New Car? Watch All The Benefits of Scrapping Your Old One

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What is a Vehicle Scrappage Policy?

In August 2021, the Indian government announced an initiative to phase out old and unfit vehicles from the roads. The idea behind the policy was to gradually develop an ecosystem that has cleaner and safer vehicles on the road. According to the handbook on Voluntary Vehicle-Fleet Modernization Program, the policy aims to achieve the following objectives:

• Scrapping unfit cars will help reduce air pollution by 15-20% to help make our ‘carbon-free nation’ goal a success. 

• There would be more jobs creation in scrapping centres hence boosting employment.

• With safety standards becoming stricter, new vehicles will be generally safer.

• It will help generate demand for new vehicles, benefiting the economy.

• Since new vehicles would comply with modern emission standards, they would likely pollute less.

What do you think of the incentives given by the automakers, as per the news report? Let us know in the comments below.

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