New vehicle scrappage policy: TN auto industry divided

The automobile industry of Tamil Nadu is divided over the Centre’s new vehicle scrapping policy. The policy envisages that commercial vehicles that have completed 15 years and private vehicles that completed 20 years and fail the fitness tests should be off the road.
Representative Image
Representative Image


While automobile dealers have welcomed the government decision, the used car industry is not upbeat on the move. The order would affect around 16 lakh vehicles in Tamil Nadu with 3 lakh vehicles in Chennai alone. 
The new policy provides a person tax concessions up to 25 per cent if he or she volunteers to scrap the vehicle as also a waiver in the registration fee during the purchase of a new vehicle. 
The Centre has directed manufacturers to provide discounts to those who have provided the vehicle scrapping certificate and this according to the automobile dealers would give the beleaguered industry a fillip. 
However, used car dealers are not keen on the decision. Wilson Joseph of BRK automobiles, who is into used car business at Ashok Nagar in Chennai said, “Irrespective of the years in operation, there are well maintained private cars and I don’t know what the new policy is in store for the second-hand market of used cars.” The decision has also not gone down well with the lorry owners. 
Coming out against the decision. Yuvaraj, president, Tamil Nadu Lorry Owners association, said, “Almost 85 pc of the medium and small-sized lorries that are used to transport goods are overaged.” 
“If all these trucks and lorries are dismantled at one go, the industry would be affected as there would be vehicle shortages leading to a spiralling of prices of essential commodities,” he added.

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