Nitin Gadkari Urges Automobile Industry to Offer Over 3% Scrap Discount
Nitin Gadkari Urges Automobile Industry to Offer Over 3% Scrap Discount
Scrapping Benefits Both Industry and Consumers, Says Transport Minister
At the 64th Annual Convention of SIAM (Society of Indian Automobile Manufacturers), Minister for Road Transport and Highways, Nitin Gadkari, called on the automobile industry to raise the current 3% scrap discount to incentivize more consumers to scrap old vehicles. He highlighted that scrapping can reduce the cost of components by 30-40%, improving profitability for OEMs (Original Equipment Manufacturers), while also benefiting customers.
Gadkari noted that the 3% discount should be seen as a minimum standard, citing that in Europe and the US, scrap discounts range between 12-13% to attract more consumers. India, with a 35% contribution to manufacturing GDP and a 13% industry growth rate, can follow suit to drive further expansion.
The Minister urged the industry to expand the number of scrapping centers in India, where there are currently 63 operational centers, with 60 more under construction and 40 in the pipeline. He encouraged the setting up of scrap and fitness centers, emphasizing the long-term profitability this would bring.
On a related note, Gadkari reiterated that electric vehicles (EVs) would achieve cost parity with petrol and diesel vehicles in the next two to three years, and he advocated for a no-subsidy approach for EV manufacturers, stating they have now reached sustainability in India.
India’s automobile industry, valued at Rs 22 lakh crore, is the third largest globally, behind China and the USA, and generates Rs 3 lakh crore in GST revenue annually. Gadkari also mentioned the government’s focus on expanding the CNG market, projecting 6,000 CNG stations by 2024 and targeting 20,000 stations by 2030 to support a growing gas economy.
In conclusion, the Minister emphasized the need to adopt new technologies and urged the industry to stop worrying about rising petrol and diesel prices, stating that the future lies in cleaner energy alternatives.
