Vehicle Scrappage Policy Launched: Tata Motors Signs MoU With Gujarat Government To Set Up Scrapping Facility

The policy aims to modernise India’s fleet of cars and also recover metals that would have otherwise gone to waste

• 450-500 automated fitness stations and 60-70 vehicle scrapping centres to be set up.

• Supposed benefits include 25 percent reduction in road tax, zero registration charges, 4-6 percent rebate on ex-showroom price, and 5 percent OEM discounts. 

• Post June 1, 2024, end of life personal vehicles will have to undergo mandatory automated fitness tests.

The Vehicle Scrappage Policy, which has been a long time coming, was finally launched in India today at an event hosted by the Ministry of Road, Transport and Highways (MoRTH) and the government of Gujarat, in the presence of PM Narendra Modi.

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As part of the policy, owners who voluntarily scrap their old vehicles will not have to pay registration charges for a new vehicle. They will also benefit from a lower road tax, though the government is yet to reveal exactly how much. From what has been suggested earlier in 2021, voluntary scrappers will get a 25 percent reduction in road tax, a 4-6 percent tax rebate on the ex-showroom price of a car, and a further 5 percent discount from the manufacturer.

Automated fitness testing will become mandatory for heavy commercial vehicles by April 1, 2023, and for private vehicles by June 1, 2024. End of life vehicles that fail to pass the automated fitness tests will have to be scrapped.

Also Read: Here’s How Much You Can Save By Scrapping Your Old Car And Buying A New One

An investment of Rs 10,000 crore is required to set up 450-500 automated testing stations in India, along with 60-70 registered vehicle scrapping facilities. A single window clearance portal will be created wherein investors can submit their details for the establishment of such centres. Their applications will be processed in 60 days.

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Tata Motors, one of India’s homegrown carmakers was also a part of the event, and has in fact signed an MoU with the government of Gujarat to set up a Registered Vehicle Scrapping Facility (RVSF) in Ahmedabad. Again, there aren’t too many details about this matter floating in the public domain, but we expect more clear-cut information to be made available soon.

These specialised scrapping centres will have facilities to scrap old vehicles (both passenger and commercial) and recover a lot of metals that would have otherwise gone to waste. They will also help in the careful disposal of hazardous materials.