Maruti Suzuki, Toyota Tsusho kickstart vehicle recycling unit

S Ronendra Singh New Delhi | Updated on November 06, 2019

Representative image   -  Shanker Chakravarty

Maruti Suzuki India (MSIL) and Toyota Tsusho Group, on Wednesday announced setting up one-of-its-kind vehicle dismantling and recycling joint venture (JV), Maruti Suzuki Toyotsu India Private Limited (MSTI).

According to a statement, Maruti Suzuki Toyotsu India Private Limited (MSTI) has been established to set up its vehicle dismantling and recycling unit in Noida, Uttar Pradesh within 2020-21.

This is the second such facility announced by an automobile company, after Mahindra & Mahindra announcing its scrappage centre last year. Many other companies are also expected to start such centres in collaboration with third partners, so that they can benefit out of the government schemes.

While, Mahindra’s facility is the first government-authorised scrappage centre in India and has the power to issue certificates to the owners of scrapped vehicles, the Maruti-Toyota venture is just the beginning and they will announce on the further details later.

Mahindra, in association with Metal Scrap Trade Corporation Ltd (MSTC), had set up a scrappage centre last year. Mahindra Accelo (a fully owned subsidiary of Mahindra) had formed a JV with MSTC for this business under a new brand, CERO (Mahindra MSTC Recycling Pvt Ltd), which is also located in Noida, Uttar Pradesh.

Meanwhile, according to the Maruti Suzuki statement, the JV is between Maruti Suzuki India Limited (MSIL) and Toyota Tsusho Group (i.e Toyota Tsusho Corporation (TTC) as well as Toyota Tsusho India Private Limited (TTIPL)). Each company owns a 50 per cent equity.

MSTI will be responsible to procure and dismantle End-of-Life Vehicles (ELVs), the statement said adding that the process will include complete solid and liquid waste management as per the Indian laws and globally approved quality and environment standards. This facility will be the first unit by MSTI and the JV will add more such units across India.

The unit will have an initial capacity to dismantle around 2,000 vehicles per month and MSTI will source vehicles from dealers as well as directly from customers.

“Through this Joint Venture, MSTI, we aim to promote recycling and support in resource optimisation and conservation while using environment friendly systems and processes. Scrapping of older vehicles in a scientific and environment friendly manner will help to reduce pollution and also make the roads safer," Kenichi Ayukawa, Managing Director and Chief Executive Officer (CEO), MSIL, said.

A team of experts at MSTI will dismantle the vehicles using international technology and global standards, he said.

“Toyota Tsusho has started ELV recycling since 1970`s in Japan. We believe that we will be able to contribute to Indian society through our knowledge and experience for ELV business. The first vehicle dismantling and recycling unit of MSTI is just the initial step and we are eager to expand to pan-India base with Maruti Suzuki," Naoji Saito, CEO (Metal Division), Toyota Tsusho Corporation said.

According to analysts, more such companies from the automotive sector would come forward, especially with the Scrappage Policy by the government expected to come in the near-term. The draft policy has been already proposed by the Road Transport and Highways Ministry in July this year.

The draft policy says that buyers would not have to pay registration fees for new vehicles if they present a scrapping certificate. The scrappage policy has been in the works for the several years now, with an aim to curb vehicular pollution by scrapping old commercial vehicles that emit toxic gases.

The automobile companies have been also seeking for scrappage policy so that old vehicle owners can afford new ones through incentive schemes.

Published on November 06, 2019

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