New Delhi: Commercial vehicle manufacturer Tata Motors on Thursday signed a Memorandum of Understanding (MoU) with the Ministry of Road Transport and Highways (MoRTH) to participate in the Centre’s vehicle replacement scheme aimed at phasing out old trucks and buses in the Delhi-NCR region.
Under the agreement, Tata Motors will offer an 8 per cent discount on the ex-showroom price of eligible trucks and buses purchased under the scheme, providing a significant incentive for fleet operators and transporters to replace ageing vehicles with cleaner and more efficient models.
For electric vehicles, the discount will be capped at the level applicable to an Internal Combustion Engine (ICE) vehicle in the corresponding Gross Vehicle Weight (GVW) category, according to the terms of the agreement.
The government-backed initiative seeks to accelerate the replacement of older commercial vehicles in Delhi-NCR, a region grappling with high levels of vehicular emissions and air pollution.
Apart from the discount offered by participating vehicle manufacturers, the Central Government will provide a 5 per cent interest subvention on vehicle financing and fixed monthly fuel vouchers for a period of five years to eligible beneficiaries.
The scheme also envisages support from participating State Governments, which will offer concessions of up to 100 per cent on motor vehicle tax for ten years and waive registration fees for vehicles purchased under the programme.
The Ministry said the combined incentives are expected to substantially reduce the cost of acquiring new commercial vehicles while encouraging the adoption of cleaner technologies.
Earlier this week, commercial vehicle makers Ashok Leyland and Switch Mobility signed similar agreements with the government for implementation of the scheme. Together, Tata Motors, Ashok Leyland and Switch Mobility account for around half of the domestic trucks and buses market, lending significant momentum to the vehicle replacement initiative.
The government’s scheme is expected to play a key role in modernising the commercial vehicle fleet in the National Capital Region, improving road safety and reducing emissions from older, polluting vehicles.