While the National Green Tribunal’s directive to RTOs to >de-register diesel vehicles that are over 10 years old in Delhi will adversely affect owners of such vehicles, it is a godsend for the industry as it may boost demand for new vehicles in the short-term.
Cost of ownership For vehicle owners, the decision will not only impact the re-sale value of their vehicles, but also drive up the cost of ownership. It will also keep buyers away from diesel cars.
“De-registering vehicles older than 10 years in one go is extremely unfair to the consumers who bought these vehicles conforming to the rules and regulations,” the country’s largest car-maker Maruti Suzuki, said in an emailed reply to a query.
The industry advocated early implementation of the scrappage policy that aims to encourage consumers to upgrade to new vehicles by offering cash incentives or discounts.
Jnaneswar Sen, Senior VP (Marketing and Sales) at Honda Cars India pointed out a piecemeal approach would impact consumer sentiment on the use of diesel. He said, “When the SC order came (banning some diesel vehicles in Delhi NCR region) we immediately saw a shift in consumer demand to petrol.” This would increase the uncertainty around the fuel, he said.
Kumar Kandaswami, Senior Director, Deloitte India, said, “Going by the announcement, if a person bought a used, 10-year-old diesel car yesterday, it can potentially be useless tomorrow, irrespective of what condition it is in.”
