Major automakers to offer rebates on new vehicles in exchange for scrappage certificate

The statement said the project could also be considered for buses and vans. | Photo: Bloomberg

3 minutes reading Last updated: August 27, 2024 | 7:06 p.m. IST

Ahead of the festive season, several passenger and commercial vehicle manufacturers have agreed to offer discounts of 1.5 to 3 per cent on the purchase of new vehicles against old scrapped vehicles after a meeting with Union Minister Nitin Gadkari, an official statement said on Tuesday.

The statement also said that Mercedes Benz India has offered a flat discount of Rs 25,000, which will be in addition to all existing discounts.

Road Transport and Highways (RT&H) Minister Nitin Gadkari on Tuesday chaired a meeting with SIAM delegation at Bharat Mandapam where he discussed pressing issues of the automobile industry.

“During this interaction, responding positively to the advice of Minister RT&H and recognising the importance of fleet modernisation and circular economy, several commercial vehicle manufacturers and several passenger vehicle manufacturers have agreed to offer discounts for a limited period against a deposit certificate (scrappage certificate),” the statement said.

He said commercial vehicle manufacturers are ready to offer rebates for a limited period of two years and passenger vehicle manufacturers are ready to offer rebates for a limited period of one year.

The statement said the reductions will further encourage vehicle scrapping, ensuring that safer, cleaner and more efficient vehicles are on the roads.

According to the statement, passenger vehicle manufacturers namely Maruti Suzuki India Ltd, Tata Motors, Mahindra & Mahindra, Hyundai Motor India, Kia Motors, Toyota Kirloskar Motor, Honda Cars, JSW MG Motor, Renault India, Nissan India and Skoda Volkswagen India will offer a discount of 1.5 per cent of the ex-showroom price of the new car or Rs 20,000, whichever is less, on the passenger vehicle scrapped by the owner in the last 6 months.

“Details of the scrapped vehicle will be linked to the Vahan system,” the statement said, adding that companies can voluntarily offer additional discounts on identified models.

The statement underlines that each passenger vehicle manufacturer may have the freedom to extend this discount only on identified models, within its vehicle portfolio.

“Since the car is not traded in but only scrapped, between the trade-in discount and the scrappage discount, only the scrappage discount will be applicable,” he said.

According to the statement, commercial vehicle manufacturers namely Tata Motors, Volvo Eicher Commercial Vehicles, Ashok Leyland, Mahindra & Mahindra, Force Motors, Isuzu Motors and SML Isuzu will offer a discount equivalent to 3 per cent of the ex-showroom price for a commercial utility vehicle above 3.5 tonnes.

“The discount offered to a person purchasing a vehicle against a negotiated deposit certificate for a scrapped commercial vehicle would be equivalent to 2.75% of the ex-showroom price for scrapping a commercial vehicle of more than 3.5 tonnes GVW (gross vehicle weight),” he said.

The press release specifies that this project could also be considered for buses and vans.

According to sources, the meeting was attended by senior auto industry officials including SIAM Chairman Vinod Aggarwal, Maruti Suzuki India MD & CEO Hisashi Takeuchi, Tata Motors Executive Director Girish Wagh, Ashok Leyland MD & CEO Shenu Agarwal and TVS Motor Co CEO KN Radhakrishnan among others.

(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First published: August 27, 2024 | 7:06 p.m. IST