- Under the new vehicle scrappage policy, customers are incentivised to scrap their old vehicles
The ministry of road transport and highways has notified the vehicle scrappage policy to gradually phase out old vehicles and provide boost to sales of vehicles across categories.
The new policy rules will kick-in from 1 April.
Under the new policy, customers are incentivised to scrap their old vehicles. Commercial vehicles of more than 15 years and passenger vehicles of more than 20 years will have to be mandatorily scrapped if they don’t pass the fitness and emission tests. Also, government departments will also have to let go of their vehicles after they are used for 15 years.
The policy can provide some obvious benefits related to a reduction in pollution, reduction in the fuel import bill, improved recycle or reuse of parts, generation of replacement related demand, and providing impetus to structuring this part of the automotive ecosystem.
According to the ministry of road transport and highways, there are 17 lakh old medium and heavy commercial vehicles in India without a valid certificate. Also, the number of light motor vehicles older than 20 years is more than 51 lakh.
According to the new system, registration fee for a motorcycle will cost around ₹300, however, the renewal for registration for a 15-year-old vehicle might cost customers ₹1,000. The high renewal fee is aimed at discouraging people from keeping old vehicles.
Customers and fleet owners will have to get their vehicles tested after 15 years to ascertain their fitness depending on the tailpipe emission and other parameters. The conducting test cost for grant and renewal of certificate of fitness for motor vehicles older than 15 years is around ₹500.
In the same way, the registration fee for a new car is around ₹600, while that for 15-year-old vehicle is as much as ₹5,000.
For the heavy goods segment, the renewal fee is around ₹1,500, and the same for medium goods/passenger vehicle costs ₹1,000.
If people are owning an imported two-or-three-wheeler motor vehicle, the renewal registration fee is as high as ₹10,000 as compared to a normal registration fee of ₹2,500.
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