Vehicle Scrappage Policy Could be Game Changer: R.C. Bhargava
Reacting to the rollout and potential of the vehicle scrappage policy, R C Bhargava, Chairman, Maruti Suzuki India said if fitness requirement was strictly enforced and vehicles got scrapped, it may lead to the creation of a large industry that would also generate usable materials for the auto sector.
Speaking to this reporter on phone, Bhargava said, “The vehicle scrappage policy could be a gamechanger for the auto industry. Manufacturing capacity will be increased by OEMs based on their assessment of the likely future sustained demand levels. Industry turnover will also increase because of the growing demand for vehicles."
Bhargava said that the vehicles on road need to be as fit in terms of safety and emission as when they were sold. Ensuring that this happens will be good for all parties and will create a win-win situation, he said. "We will all watch how the policy leads to the growth of sales,” he added. When queried about the upcoming Green Cess, Bhargava said he would first see the scheme and its fine print before making any comments on it.
Unlike its peers, Maruti Suzuki has ramped up its output by 2.5 million units at its Gujarat plan taking its total installed capacity to 22.5 million units (including 15.5 million units between Gurgaon and Manesar plants). Bhargava said Maruti has earmarked a total investment of Rs 4,500 crore for this year which is more than double the amount (Rs1,900 crore) spent by the company in the previous year.
