Mahindra & Mahindra (M&M) Ltd on Wednesday said it has inked an initial pact with its automotive and steel recycling JV MMRPL to offer its customers an end-to-end solution for vehicle scrapping.

The move comes in the wake of the government last month proposing a policy for vehicle scrapping, under which vehicles that fail fitness tests or are unable to renew registration after 15-20 years of use will be deregistered.

Mahindra MSTC Recycling Private Limited (MMRPL), which is in the business of acquiring used/end-of-life vehicles to dismantle and scrap them, is a joint venture between Mahindra Intertrade Ltd and MSTC Ltd, a government of India enterprise.

In 2018, it was set up as an automotive and steel Recycling facility, under the brand name CERO, at Greater Noida, in Uttar Pradesh.

"Our agreement with MMRPL is a step towards a one-stop solution for customers who wish to scrap their old vehicle. While the scrappage policy will take effect in some time, we are ready to help the customers who intend to discard their vehicles," said Veejay Ram Nakra, CEO Automotive Division, Mahindra & Mahindra Ltd.

The agreement with MMRPL will enable customers to get a hassle-free and transparent deal under one roof, the company said, adding, any customer intending to purchase a new Mahindra vehicle by scrapping/ exchanging the old vehicle which is more than 15 years old can do so at any of its dealerships.

These services would provide utmost convenience to the customer without the need to look for a vehicle scrapping agency/dealer, it said.

Under the proposed policy, a scrapped vehicle will be offered a monetary value close to 4-6 per cent of the showroom value. There could even be up to a 5 per cent discount on the purchase of a new vehicle if a scrap certificate is produced.

In addition, it also offers a 25 per cent discount on road tax, among others.

According to the company, Mahindra dealerships along with CERO will offer services such as vehicle evaluation, arranging quotes for exchange/ scrappage value of the vehicle, providing end-to-end services including vehicle pickup, transportation, and environment-friendly dismantling at CERO scrap yards.

Post this, the Certificate of Deposit/Destruction (COD) will be issued by CERO, which will enable customers to claim eligible benefits under the upcoming Scrappage Policy, it added.

Besides, given the Covid-19 scenario, Mahindra is offering an evaluation of the vehicle at the doorstep as well.

"The arrangement with M&M is going to strengthen this reach and benefit all Mahindra vehicle customers who are looking for solutions for scrapping their old vehicles," said Sumit Issar, Managing Director of Mahindra Intertrade Ltd.

CERO is India’s first authorized recycler for motor vehicles built on Public-Private Partnership (PPP) model, with dismantling centers at Greater Noida, Pune, and Chennai and in addition collection centers at major cities such as Mumbai, Bangalore, Hyderabad, Ahmedabad, Jaipur, and Chandigarh, he said.

"Further, CERO has plans to have a presence in 25 cities within the next 8-10 months,” he added.