Why Aren’t Indians Scrapping Old Vehicles? Govt Asks SIAM to Explain Lag

Government has urged the Society of Indian Automobile Manufacturers (SIAM) to share records that highlight why India’s vehicle-scrapping facilities haven’t gained momentum yet. Presently, the Nitin Gadkari-led Ministry of Road Transport and Highways is holding talks with scrapping centres to understand issues faced by them in attracting footfalls and is also mulling to increase the number of facilities to fuel the decarbonisation drive, the Mint reported. The development comes around a time when the government is pinning its hope on getting older vehicles off the road to reduce carbon emissions. 

“The ministry is seeking the industry’s view on why scrapping has not taken off. There have been operational challenges with scrapping centres. They are not receiving adequate demand, and these issues need to be addressed,” the Mint reported, citing sources. “There should be more scrapping centres in the country, and consultations with industry are currently on to understand the issues that these facilities face,” the sources added.

While on one hand schemes like the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) have been introduced to fuel adoption of electric vehicles, on the other hand scrapping centres are being promoted by the government to free the roads off petrol and diesel vehicles whose lifespan stretch beyond 15 years and 10 years, respectively. PM E-Drive was introduced in 2024 by the government to boost green mobility in the country.

Why India’s Vehicle Scrappage Units Aren't Gaining Traction?

As of July 29, 2025, India has around 173 scrapping facilities, according to the road ministry’s vehicle-scrapping portal. The government launched these centres with an aim to boost the electric auto sector and ensure checks on vehicular pollution. These facilities comprise centers for inspection and scrap yards to assess the condition of vehicles before scrapping. The auto owner can voluntarily choose to scrap the vehicle by simply filing an online application, and the concerned government authority will issue a certificate of deposit (CD), which is tradable and has financial benefit. After the vehicle has been scrapped, a certificate of vehicle scrapping (CVS) will be issued. 

Despite these efforts to streamline the scrapping of older vehicles, the government’s policy hasn’t been able to attract a significant number of owners, mainly as the value received by the customers in return is low. 

“The ELV (end-of-life vehicle) scrapping centres in the country are not able to get enough vehicles for dismantling for better utilisation of the facilities installed and ELV dismantling centres operate on very thin margins,” IV Rao told the Mint. Rao is a distinguished fellow-transport and urban governance at the policy think tank, Energy and Research Institute (TERI).