Maruti Suzuki and Toyota Tsusho Group’s vehicle dismantling and recycling joint venture — Maruti Suzuki Toyotsu India Private Limited (MSTI), situated in Noida, Uttar Pradesh, may kick off next month.

MSTI is a JV between MSIL and Toyota Tsusho Group (Toyota Tsusho Corporation and Toyota Tsusho India Private Limited) with each owning 50 per cent equity.

Sources told BusinessLine, the centre at Noida is ready and some trials were on. The joint venture was announced in 2019 and the operations were to begin during the last financial year.

Trials begin

“Because of Covid it is a bit behind schedule. The operations are expected to start from July and right now trials are on. To begin with, the centre will start with the old test vehicles of Maruti Suzuki India (MSIL), which are at end of life now,” an official said.

All the machineries are in place to dismantle vehicle parts like the engine, aluminium, plastics, copper and other raw materials, another official said. All the scrapped materials will be sold to scrap dealers, the official said adding that anybody/ individuals who want to scrap their old vehicles can bring to the unit, and in return they will be provided with a certificate with details to enable them get incentives on buying new cars, according to the government norms, he further said.

Sops for new vehicles

Nitin Gadkari, Minister of Road Transport and Highways, in March had announced that people who junk their old vehicles and buy a new one under the purview of ‘Vehicle Scrappage Policy’ will receive about five-per cent rebate from automakers on purchase of new vehicles.

Another official aware of the development said MSIL’s used car unit True Value will also bring old vehicles for scrappage from its outlets.

MSTI is responsible for procuring and dismantling End-of-Life Vehicles (ELVs). The process will include complete solid and liquid waste management as per the Indian laws and globally approved quality and environment standards.

According to the 2019 announcement, the unit will have an initial capacity to dismantle around 2,000 vehicles per month. MSTI will source vehicles from dealers as well as directly from customers. According to analysts, the auto sector is expected to get a boost from the increased demand and an investment of over ₹10,000 crore. An estimated over one-crore vehicles will be affected by scrappage policy and 35,000 additional jobs are likely to be created under the policy.

Demand in the initial years could be supported by scrapping of government vehicles that are 15 years old and overall around 2.37 lakh vehicles belonging to Central / State governments are likely to be scrapped, they added.

M&M centre

Apart from MSTI, Mahindra & Mahindra has also vehicle scrappage centres – Mahindra MSTC Recycling Private Limited (CERO), which is a joint venture between Mahindra Intertrade and MSTC (a government Enterprise). It has set up three recycling plants at Greater Noida, Chennai and Pune, under the brand name CERO.

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