Chennai: India’s vehicle scrappage programme is gathering momentum, but its rollout remains uneven, with Tamil Nadu and other southern states trailing their northern counterparts despite accounting for a substantial share of new vehicle sales. So far, about 4.4 lakh vehicles have been scrapped at registered vehicle scrapping facilities (RVSFs) across the country under the Centre’s voluntary policy. Nearly 70% of these were passenger vehicles, while buses accounted for about 5% and trucks roughly 6%, underscoring the limited penetration in the commercial vehicle segment — one of the largest pools of ageing and polluting vehicles. The regional divide is stark. North India accounts for nearly 70% of total scrappage volumes. Early infrastructure creation, strong investor participation, and enforcement-led measures — particularly in the National Capital Region — have driven momentum. The decision to mandatorily scrap government vehicles older than 15 years served as an early catalyst, validating processes and signalling policy intent to the broader market. In contrast, South India accounted for only about 7% of vehicles scrapped nationally in 2026, despite contributing close to 30% of vehicle sales. The shortfall spans all segments. A study by CII and global consultancy Kearney highlights structural gaps in the region. Southern states lag the national average on both testing and scrappage outcomes, with only about 17%–18% of planned Automated Testing Station (ATS) capacity operational. ATS facilities account for less than a quarter of fitness tests, with the majority still routed through legacy channels. “The scrappage policy is centrally framed but state-executed, reflecting India’s federal transport governance structure and resulting in uneven adoption,” said Nithin Chandra, senior partner at Kearney, adding, “While there has been strong uptake in the North, differences in administrative capacity, institutional readiness, fiscal space, and enforcement linked to air quality or congestion pressures explain the slower progress in the South.“Northern states, especially those around Delhi-NCR, moved early to establish ATS and RVSF infrastructure alongside tighter enforcement. By comparison, several southern states operationalised scrapping facilities only in 2025–26. Although enforcement has since begun to strengthen, the region remains underpenetrated in terms of operational RVSFs relative to its vehicle base, constraining volumes. Scrappage rates are expected to improve as infrastructure stabilises and capacity utilisation rises, Chandra said. Even in the North, however, annual scrappage volumes remain a fraction of the total ageing vehicle population. Weak enforcement of usage restrictions continues to allow many older, polluting vehicles to stay on the road despite the availability of scrappage infrastructure.
