India’s Vehicle Scrappage Policy, which aims to phase out old and polluting vehicles, could provide a boost to the country’s aluminum industry. Aluminum is a key material in the manufacture of new vehicles, and the policy could create demand for recycled aluminum from old vehicles. This could benefit aluminum makers by providing them with a new source of raw material and by helping them to reduce their environmental impact.
India’s end-of-life vehicle (ELV) scrappage policy was introduced in April 2022, with implementation gaining momentum this year amid government stimulus and incentives in its Union Budget 2023. The policy aims to phase out vehicles older than 15 years to expedite the green energy transition in the automotive sector.
The policy has several benefits for aluminum makers in India. First, it will increase the supply of aluminum scrap. Scrapped vehicles contain a significant amount of aluminum, which can be recycled and reused. This will help to reduce India’s reliance on imported aluminum scrap.
Second, the policy will create new demand for aluminum. As old vehicles are scrapped, new vehicles will need to be purchased. This will create demand for aluminum for use in new cars, trucks, and buses.
Third, the policy will help to improve the environment. Scrapping old vehicles will help to reduce air pollution and greenhouse gas emissions. This is because old vehicles are typically less fuel-efficient and emit more pollutants than newer vehicles.
Overall, India’s vehicle scrappage policy is a positive development for the aluminum industry in India. The policy will increase the supply of aluminum scrap, create new demand for aluminum, and help to improve the environment.
In more detail, here are the specific benefits of the scrappage policy for aluminum makers:
- Increased supply of aluminum scrap: Scrapped vehicles contain a significant amount of aluminum, which can be recycled and reused. This will help to reduce India’s reliance on imported aluminum scrap. According to the Indian government, an average of 145 kilograms of aluminum are used in a car body, and about 90 percent of the aluminum used in a car can be recovered. Given the higher value of the metal, the 7 percent to 8 percent of aluminum retrieved from a car accounts for 50 percent of a vehicle’s scrap value.
- New demand for aluminum: As old vehicles are scrapped, new vehicles will need to be purchased. This will create demand for aluminum for use in new cars, trucks, and buses. According to the Indian government, the scrappage policy is expected to create an additional demand of 1.5 million tons of aluminum by 2027. This will help to boost the Indian aluminum industry and create jobs.
- Improved environment: Scrapping old vehicles will help to reduce air pollution and greenhouse gas emissions. This is because old vehicles are typically less fuel-efficient and emit more pollutants than newer vehicles. According to the Indian government, the scrappage policy is expected to reduce air pollution by 2.5 million tons and greenhouse gas emissions by 10 million tons by 2027. This will help to improve the quality of air in Indian cities and reduce the country’s carbon footprint.
Overall, India’s vehicle scrappage policy is a positive development for the aluminum industry in India. The policy will increase the supply of aluminum scrap, create new demand for aluminum, and help to improve the environment.
Source www.recyclingtoday.com
