Addressing the need for a channel to dispose of old vehicles and boost new vehicle purchase, the Maruti Suzuki-Toyota alliance is planning to set-up a scrappage plant that will be located in Greater Noida.
The Maruti Suzuki–Toyota partnership was confirmed in 2017, which would see the carmakers access either party’s pool of vehicles that would be rebadged and sold under their respective brands. It now seems, the automakers are planning to take the partnership a step further and are in the process of setting up a scrappage plant together in India, a recent report claims. Under the partnership, Maruti Suzuki and Toyota Tsusho India will be set-up the scrappage plant in Greater Noida, and will be the second manufacturer-owned facility in the country. The report says that the joint venture will supply, dismantle and process end-of-life vehicles, and market and sell scrap and other products generated from such activities.
carandbike reached out to Toyota Kirloskar Motor (TKM) for a comment but the company said that “As Toyota Tsusho is a separate entity, TKM will not be able to comment on their plans/media reports.” Maruti Suzuki too did not comment on the report, when reached out. Toyota Tsusho already has presence in India and is involved in the manufacturing and sale of auto components and logistics management.
The report emerges amidst the government’s plans to finalise the Scrappage policy for vehicles. Minister of Road Transport and Highways (MoRTH), Nitin Gadkari recently said that the policy was being pushed soon and will be finalised soon. The scrappage policy is part of the stimulus package that the auto industry is expecting from the government to overcome the current auto crisis. A 10 per cent reduction in GST rates for vehicles has also been proposed and the GST Council will take a call on the same at the council meeting on September 20, 2019.
Apart from Maruti Suzuki-Toyota, Mahindra & Mahindra through its subsidiary Mahindra Accelo, in a joint venture with MSTC, has also established a scrappage plant in Greater Noida. The vehicle scrappage space currently is largely unorganised in India and corporates have a good opportunity to bring organisation in this sector pan India. This, however, will also depend on the framework that is laid out for the scrappage policy. A time for the policy to be introduced is yet to be announced by the government.
Meanwhile, the Maruti Suzuki-Toyota partnership will introduce new cross-badged products going forward. The Toyota Glanza (rebadged Maruti Suzuki Baleno) was the first offering to come from the alliance, which is expected to followed with the Toyota versions of the Vitara Brezza and the Ertiga. There are also reports of Suzuki introducing its iteration of the Corolla sedan in the country. Maruti Suzuki and Toyota are also said to be working on hybrid technology for India, which will be shared by both companies for its line-up of cars in hte future.