MANAGING ELVS

With the talk of scrappage policy, the End-Of-Life (ELV) journey of an automobile is once again under the spotlight.

- Deepti Thore

India is expected to reach a market size of 20 to 22 million ELVs by 2025 as per a report released by Kearney. This would amount to a business segment value between Rs.9400 crores and Rs.12,500 crores. With the scrappage policy expected to be announced soon, the generation of scrap through the ELV journey of automobiles is expected to reach 5.6 million tonnes per annum by 2025. Expected to have a major share of around 40 to 50 per cent are commercial vehicles(CVs) in terms of market value simply because the content that goes in them is considerably more per vehicle when compared to a typical passenger car or a two-wheeler. CVs are also said to emit more on a per-vehicle basis when compared to a private vehicle. And, despite there being a lot more two-wheelers or three-wheelers as CVs often tend to stay on the road for more years on average, emit more during their operating lifecycle and are perhaps more liable to flouting emission and other norms.

Putting CVs under the spotlight when compared to the private vehicles is their fairly significant contribution to the market size even though they amount to approximately six per cent of the vehicle parc, according to the analysis made by Kearney. Shovik Banerjee, Principal, Kearney informed that passenger vehicles acquire the second-largest share of around 10 to 30 per cent with about 12 percent vehicle parc followed by three-wheelers which are about five per cent in terms of value as well as in terms of the number of units, and then two-wheelers with a share of 25-35 per cent in ELVs and vehicle parc of about 80 per cent. The value of that particular segment in terms of end of life vehicles is about 25 to 35.

Understanding ELV