Vehicle Scrap || What is the benefit to the car owner

What is India’s policy on vehicle scrappage?

The Vehicle Scrappage Policy is a government-funded initiative to remove old and unsafe automobiles from Indian roadways and replace them with new, contemporary vehicles. The policy’s main objective is to establish a framework for gradually phasing out unsuitable and polluting automobiles to reduce the nation’s carbon footprint.

Heavy Commercial Vehicles (HCVs) will only be subject to automated testing stations starting on April 1, 2023. (ATSs). The fitness testing for additional categories of Commercial Vehicles (CVs) and Private Vehicles (PVs) must also be done through the ATS, and it must start on June 1st, 2024.

If they fail the fitness test, commercial cars, and private vehicles older than 15 and 20 years, respectively, must be destroyed. A vehicle will be classified as an ELV if it fails the fitness test (End-of-Life Vehicle).

Vehicle scrappage policy

Highlights of the Announcement of the Vehicle Scrappage Policy

Since the second part of 2019, there have been difficulties in the Indian automotive industry. The subsequent COVID-19 outbreak exacerbated the problem. The issue remains concerning even if post-Diwali sales in 2020 have helped the sector to some extent. The faltering Indian vehicle industry is reportedly helped by the scrappage policy. There will be a desire for new cars when existing cars are phased out. The ecosystem will also gain from the destruction of inappropriate automobiles.

Here is a summary of the announcement’s important points about the vehicle scrappage policy.

  • The goal of the strategy is to create a mechanism in India for the destruction of defective automobiles.
  • The actual scrapping procedure will be governed by rules and regulations, which the MoRTH will outline in its statement.
  • Owners of automobiles will receive certain perks for scrapping their old vehicles.
  • Air pollution will be significantly reduced with the aid of the scrapping of inefficient automobiles (subjective as per location).
  • Vehicles that are safe, secure, and technologically sophisticated will be in high demand.

What is the purpose of the 2021 Vehicle Scrappage Policy?

Vehicle scrappage policy 2021

The primary goal of the Vehicle Scrappage Policy 2021 is to seize and scrap outdated, unsafe, and polluting cars. Here are some of the main lessons learned from the automobile scrappage program.

  • Scrapping automobiles with expired licenses and registrations will reduce emissions.
  • increase the safety of people, vehicles, and roads.
  • create jobs for the automotive industry.
  • formalize the currently unregulated auto recycling sector.
  • Boost fuel economy and save car owners’ maintenance expenditures.
  • Increase the supply of low-cost raw materials for the steel, electronics, and automobile industries.

Benefits of the Policy on Vehicle Scrapping

Here is a list of the new vehicle scrap policy’s possible advantages for the economy, the auto industry, car owners, and other groups.

  • Air pollution will be reduced and air quality will improve when unsuitable cars are scrapped.
  • As old cars are demolished and replaced with new ones, there will be greater demand for new automobiles. The average age of private and commercial light motor vehicles is over 20 years old.
  • Overall, the new scrappage policy will help the car industry by creating additional work possibilities. For instance, new automobile scrapping facilities will require personnel.
  • New, technologically improved cars will be considerably safer. For instance, modern automobiles have greater safety measures.
  • Additionally, the recycling sector will be busier, generating more money.
  • There may be tax advantages for car owners who scrap their old vehicles.
  • Owners of vehicles could also receive the greatest price for auto scrappage for usable components like tires.

Indian roadways are used by a variety of vehicles. Because of this heterogeneity, not all automobiles can be subject to the same laws. Consequently, there is a need to classify automobiles in terms of scrapping. Here are some specifics.

Vehicle Scraping

Government automobiles

In January 2021, the Government Vehicle Scrappage Policy was adopted. According to this approval, any automobiles owned by the federal government’s central or state governments that are older than 15 years must be demolished. A similar regulation will take effect next year. The implementation of this regulation is scheduled to begin on 1 April 2022.

Commercial Automobiles

Commercial vehicles include all automobiles used for business, such as transport automobiles. A fitness test for the business vehicle is required after 15 years have passed. If deemed unsuitable, the vehicle must be destroyed following the guidelines of the commercial vehicle scrap policy.

Private Automobiles

Private vehicles are those used by individuals to get from one location to another. A private vehicle fitness test has a 15-year-old minimum age requirement.

Vintage Automobiles

Compared to ordinary vehicles on the road, vintage automobiles and bicycles are often older. They are well-maintained and driven less frequently, nevertheless. As a result, this is a distinct category, and guidelines for discarding such cars must take into account their character.

Vehicle Fitness Checks

The main components of an old vehicle fitness test under the Vehicle Scrappage Policy 2021 are listed below.

  • To assess if a vehicle is roadworthy, fitness testing entails a thorough inspection.
  • The test also assesses if the car is polluting the environment.
  • You must examine the vehicle’s fitness at authorized Automated Testing Stations like how you check your car’s emission levels through the Pollution Under Control test.
  • The vehicle must undertake fitness tests beyond the first fitness test’s validity period of five years.
  • If a vehicle fails the fitness test, its registration cannot be renewed.
  • Older cars that have passed the fitness test may be subject to a green cess of 10 to 15 percent of the road tax. It could differ depending on the area.
  • Owners of automobiles that are considered to be unsuitable have the option of scrapping them. They do have the option to fix it, though, to pass the fitness test.

Where do I go to get the car inspected or scrapped?

If your vehicle’s registration has to be renewed, there are a few crucial things you need to keep in mind.

  • To keep the car, go to the authorized Automated Testing Station (ATS).
  • If you wish to scrap the car, go to the nearest authorized scrap yard.
  • You must wait until the ATSs are working if you intend to dispose of your car. They ought to be reachable via the VAHAN database.

What are the benefits of recycling old cars?

The rewards for recycling old cars are listed below.

  • Available a discount: After the car is scrapped, the owner could get a 4–6% reduction on the price of a replacement car (ex-showroom).
  • No registration charges: The new car’s registration payments are exempt once the Certificate of Deposit is declared.
  • Concession on road tax: State governments could provide a discount on the new vehicle’s road tax. For non-transport vehicles, the concession may be up to 25%, whereas for transport vehicles, it may be 15%.
  • Discount on a new vehicle: Manufacturers of vehicles have been asked to provide a 5% discount when buying a new car with the Certificate of Deposit. In addition to the scrap value you get for your car, you also get this reduction.

What are the drawbacks of owning an antique car?

Here are some drawbacks of driving an outdated car.

  • Higher fees: For commercial vehicles that are more than 15 years old, there are increased fees for the fitness test and the issuance of a Fitness Certificate (FC).
  • Higher re-registration fees: The costs for renewing the RC are greater for private automobiles that are older than 15 years.
  • Green Cess: For such older cars, a green cess of 10 to 15% over and above the road tax shall be payable.

How likely is it that my automobile will be scrapped?

Vehicles that are outdated, unsuitable, and emit pollution increase the nation’s carbon footprint. There are a few laws and regulations to help with the renewal of registration or scrapping of older cars following the new Vehicle Scrappage Policy 2021 to formalize the vehicle scrapping facility in India. The requirements for scrapping an old car are listed below.

  • Vehicles over 15 years old must pass a fitness test before their registration may be renewed.
  • The owner might choose to fix the car and request a retest if the car is deemed unsuitable.
  • The car will be deemed an End-of-Life Vehicle (ELV) and be eligible for scrapping if it fails the fitness test.

How does the policy affect you as an owner of a two-wheeler?

The effect of the bike scrap policy on a two-wheeler owner is shown below.

  • Mandatory fitness test: To operate a two-wheeler, you must pass a fitness exam. The fitness of the bike will be examined. Owners can request a retest and have their car fixed if it is unsuitable. The two-wheeler will be classified as an ELV and be available for scrapping if it is determined to be defective.
  • Automated fitness test: Fitness assessments are still done by hand. To ensure accurate findings, the vehicle must now undergo a computerized fitness test without human intervention as part of the Vehicle Scrappage Policy.
  • Compulsory End-of-Life Vehicle (ELV) certificate: Your two-wheeler will be judged unfit if it fails the computerized fitness test, and the ATS will issue an ELV certificate. You are unable to cover your bike with the required Third-party Bike Insurance since the vehicle is not roadworthy.

How is an automobile disposed of in India?

The method for scrapping cars in India is shown here.

Step 1: Call the recycling facility
  • Contact the approved recycler by phone or through their websites.
  • Once you have an appointment, you can either drive your automobile to the junkyard or ask them to pick it up from your house. Please be aware that if you want them to come to get your car, there can be a towing fee.
Step 2: Complete the paperwork.
  • A duplicate of the car owner’s permanent account number.
  • Vehicle’s original registration certificate.
  • Certificate for End-of-Life Vehicles issued by the Automated Testing Station.
  • Check canceled.
  • If the owner of the vehicle is unavailable to bring the car to the Automated Testing Station, a letter of authorization on stamped paper must be provided for the authorized person.
  • Identity documentation for the authorized individual, such as a passport, driver’s license, Aadhaar card, voter registration card, or picture ID card issued by the State or Federal governments.
  • Proof of the owner’s address for the car (bills for electricity, water, landlines, gas, etc.
  • Photograph of the car owner or another authorized individual holding the ELV.
  • a declaration that, to the best of their knowledge, all the information provided is truthful and accurate from the vehicle owner.
Step 3: Start the scrapping now.
  • Usually, the recycler removes the CNG kit, battery, and tires (if any). The air conditioning unit’s refrigerant is drained and sent to the de-pollution station. All liquids are also removed, including engine coolant, gearbox oil, petrol, brake fluid, steering fluid, windscreen washer fluid, and engine oil. The gasoline tank and exhaust system are taken out of the car by the recycler.
  • The body panels, boot lid, bonnet, fenders, doors, headlights, and bumpers are physically removed once the vehicle’s fluids have all been drained. Then, physically remove the dashboard, roof liner, seats, floor mats, steering wheel, and other interior parts. The vehicle’s wiring system is likewise taken out.
  • The vehicle’s running gear is then removed, it is elevated, and the engine, brakes, and suspension are also taken out of the vehicle. The VIN (vehicle identification number) plate is then finally removed.
Step 4: The leftover vehicle component is recycled or put to other uses.
  • All the car’s components have been taken out, leaving only the body shell.
  • A crane raises the car’s body shell and lowers it into a crushing machine. The steel bale that is produced by the crusher will be sold for smelting.
  • The remaining components will either be sold or dismantled and put into a steel bale.
  • To prevent environmental pollution, the recycler makes sure that no oil or AC fumes are released into the atmosphere or onto the ground.
Step 5: Obtain the certificate of scrapping.
  • The recycler will provide a “certificate of destruction” once the automobile has been destroyed.
  • The certificate can be used to have the car de-registered at the relevant Regional Transport Office (RTO). You will get paid for the scrap value either by check or electronically.
  • In addition to utilizing the certificate for the de-registration procedure, you may use it to get a discount on your next automobile from the manufacturer, as well as a reduction in road tax and a full remission of the vehicle registration fees.

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