Following the news that Tata Motors has opened its second registered vehicle scrapping facility (RVSF) in Bhubaneswar, Odisha, India;

Rupayan Chakraborty, Automotive Analyst at GlobalData, offers his view:

“Tata Motors, one of the renowned MNCs, inaugurated its second vehicle recycling facility in India for end-of-life vehicle recycling. The expansion is expected to lead to numerous economic benefits such as job creation, pollution prevention, and waste reduction. According to the group, the facility will scrape a capacity of 10,000 end-of-life vehicles every year. This will undoubtedly save resources while also reducing trash and landfill space in the country and improving resource utilization.

“The new facility builds on the success of its first vehicle recycling plant in Jaipur Rajasthan, which was launched in February 2023. The two new Tata Motor facilities will make a significant contribution to the environment by creating vehicle scrappage centers, in line with Mahindra MSTC Recycling, India’s first government-authorized car recycler. Furthermore, it is apparent that Indian automakers are aware of the need for a better environment and see recycling as a business opportunity.

“According to GlobalData, 15% of India’s total car parc is over 13 years old. It will reach to 20% of total parc by 2026, growing at a compound annual growth rate (CAGR) of 5.92% over 2021-2026. Given that the Indian government has a scrappage policy for vehicles of 15-20 years and considering the current age status of the vehicle parc, construction of new recycling facilities will provide significant returns to Tata Motors in the near future. The facilities will be able to reduce operational and material manufacturing costs, as they help in providing in-house recycled material to produce new ones.”