Gadkari Urges Automakers to Offer Bigger Discounts for Old Vehicle Scrappage

Automobile manufacturers need to provide larger discounts on new vehicle purchases in exchange for scrapped old vehicles to remain competitive in the growing market, according to Nitin Gadkari, India’s Minister of Road Transport and Highways. Speaking at the 64th annual session of the Automotive Component Manufacturers Association (ACMA), Gadkari emphasized that customers are savvy and will only invest if they perceive value.

“With increasing competition, manufacturers have no choice but to increase discounts for old vehicle scrappage. Whether they like it or not, customers are intelligent and will not pay for products if they don’t feel it’s worth it,” Gadkari stated.

Gadkari also noted the steady decline in lithium-ion battery prices, making electric vehicles (EVs) more cost-competitive. He predicted that within two years, EVs will reach price parity with petrol and diesel vehicles, largely due to reduced production costs. Although subsidies are currently in place to support EV adoption, Gadkari suggested that EVs could soon stand on their own without government incentives.

Recent reports indicated that automakers are already offering discounts of 1.5-3 percent, or up to ₹25,000, for new vehicles purchased against scrapped old ones. Gadkari has been advocating for such discounts for several years, but manufacturers were initially reluctant to adopt the strategy.

The minister expressed confidence that India could soon become the world’s leading automotive manufacturing hub, driven by technological advancements, skilled labor, and a strong global reputation.

As the transition to electric vehicles continues, the scrappage policy could play a vital role in modernizing India’s vehicle fleet while boosting the auto industry’s growth trajectory.