Indian ELV and Dismantling Market Trends and Developments
It is not unusual then that the country has an abundance of recyclable and salvageable materials. The recycling and salvaging industry in India is still in a nascent stage, which is offering a number of opportunities to the companies operating in the Indian end-of-life vehicle and dismantling market. In 2018, about 6.8 million vehicles in India reached their end-of-life. While the industry in India is at an initial stage currently, it is expected to witness considerable growth in the years to come. ELVs are dismantled into numerous different parts, and each individual part has a different market.
The automotive sector in the India has been growing swiftly since the past few years, attributed to the string economic growth and rapidly increasing disposable income of people. The lifestyle of people in the country has improved considerably, and owing a private vehicle has become a status symbol. This is why an increased number of people are now investing in automobiles. In addition to this, due to various government policies, the prices of electric vehicles have lowered considerably, thereby allowing a larger number of people to afford these vehicles.
In-depth Competitive Landscape of the Indian ELV and Dismantling Market
Government policies in the country are among the major factors that are resulting in the growth of the market. A number of state governments, along with the Ministry of Road Transport and Highways, Ministry of Steel, and Ministry of Heavy Industries & Public Enterprise, have led to the initiation of policy formulating process regarding setting up of scrap yards, so that transition from traditional to eco-friendly variants can be made. In addition to this, government bodies are staying committed to good manufacturing policies by encouraging and pushing adoption of environment-friendly and state-of-the-art technologies.
Owing to all these factors, the Indian ELV and dismantling market generated a revenue of $3,474.0 million in 2019 and is predicted to progress at a 17.2% CAGR during the forecast period (2020–2030). When fuel is taken into consideration, the market is divided into diesel and petrol, between which, the diesel division is predicted to hold the major share of the market during the forecast period. This can be because several commercial vehicles, including heavy-duty variants, and passenger vehicles in the country run on diesel. On the basis of components, the market is categorized into glass, ferrous metal, battery, textile, tire, electrical and electronic equipment, non-ferrous metal, and plastic.
Indian ELV and Dismantling Market Competitive Landscape
Among these, the ferrous category held the largest share of the Indian ELV and dismantling market in 2019, as per report by P&S Intelligence. This is due to the fact that 70% of an automobile is made up of steel and iron. Furthermore, metallic components are easy to separate from vehicles. Other than this, the electronic and electrical equipment category is predicted to grow at the fastest pace during the forecast period, which is owing to the surging integration of autonomous features in vehicles.
In conclusion, the surging growth of the automobile industry and increasing government policies are driving the expansion of the market.
India is one of the largest automobile markets in the world, with sales increasing every year. With this, even the number of vehicles to have reached their end of life is rising, which is leading to a wide volume of metallic, rubber, and plastic waste just strewn everywhere. Additionally, for want of money and lack of stringent regulations, many people continue to operate their vehicles beyond the recommended period, which leads to heavy emissions of greenhouse gases (GHGs) from an engine that has witnessed extensive wear and tear.
Indian ELV and Dismantling Market Trends and Opportunities
P&S Intelligence says that all these factors will propel the Indian end-of-life vehicle (ELV) and dismantling market from $3,474.0 million in 2019 at a 17.2% CAGR between 2020 and 2030 (forecast period). However, the biggest hurdle in the industry growth presently is the alleged monopoly of unorganized garages and scrapyards. For instance, the automobile scrapyard in Mayapuri, Delhi, which is the largest in Asia (it has an annual turnover of around GBP 600 million, as per The Telegraph), has 4,000 small-scale units working day and night, throwing all safety caution to the wind.
But, now, considering the unsafe conditions people work in here and the dangers these scrapping units pose to the surrounding residential areas, the Indian government has swung into action. Illegal and unorganized scrapping units are being closed across the countries, and well-established companies, such as automakers, are being encouraged to undertake dismantling and recycling activities. In addition, the National Green Tribunal (NGT) has now capped the maximum service life of petrol (gasoline) and diesel automobiles at 15 and 10 years, respectively, starting with the Delhi–National Capital Region (NCR).
Indian ELV and Dismantling Market Business Opportunities
Since the order on the closure of such scrapping units, the influence of organized companies in the Indian end-of-life vehicle and dismantling market is increasing. For instance, in November 2019, various subsidiaries of Indian auto major Mahindra and Mahindra jointly inaugurated an ELV dismantling plant in Greater Noida, Uttar Pradesh. This is to be followed by the setting up of 25 more such units across the country by 2022. That month, Toyota Motor Corp. and Suzuki Motor Corp. also entered a partnership to establish an ELV dismantling and recycling venture in the country.
The market is divided on the basis of fuel into petrol, diesel, and others, among which the diesel category held the largest value share in 2019. Diesel vehicles are shorter lasting than those using petrol and other fuels, thus account for the highest dismantling rate after their end of life. Moreover, a large number of passenger vehicles and almost all commercial vehicles run on diesel, which is cleaner, cheaper, and more powerful. This means that more diesel automobiles reach the end of their life than those using other fuels.
Indian ELV and Dismantling Market Drivers
Non-ferrous metal, ferrous metal, electrical and electronic equipment, plastic, tire, textile, glass, and battery are the various categories of the Indian end-of-life vehicle and dismantling market, on the basis of component. Among them, the ferrous metal category dominated the market in 2019, as a vehicle is almost 70% iron and steel, which are the easiest to separate from the post-dismantling waste, requiring a large magnet at the most. Further, to be reused, the metals merely need to be cleaned, melted, and then recast into the desired shape.
Thus, as more unorganized scrapyards are shut down and more ELVs are available, established companies are expected to carry out dismantling and recycling activities in the country, following globally accepted safety standards.
The research offers size of the India end-of-life vehicle and dismantling market for the period 2014–2030.
Market Segmentation by Fuel
- Ferrous Metal
- Non-Ferrous Metal
- Electrical and Electronic Equipment
- Tamil Nadu
- Uttar Pradesh
- Madhya Pradesh
This study covers
- Major factors driving the market and their impact during the short, medium, and long terms
- Market restraints and their impact during the short, medium, and long terms
- Recent trends and evolving opportunities for the market participants
- Historical and the present size of the market segments and understand their comparative future potential
- Potential of on-demand logistics services, so the market players make informed decisions on the sales of their offerings
- Competitive scenario of various market segments across key countries in several regions for uncovering market opportunities for the stakeholders
- Major players operating in the market and their service offerings