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Maruti, Toyota to set up vehicle dismantling and recycling joint venture

The new joint venture (JV) extends the existing partnerships between Suzuki Motors and Toyota Motor Corporation in India.

Maruti Suzuki India (MSIL) and Toyota Tsusho Group on Wednesday announced the setting up of a vehicle dismantling and recycling joint venture. The plant, which will be set up in Noida by 2020-21, will have an initial capacity to dismantle 2,000 vehicles per month.

The new joint venture (JV) extends the existing partnerships between Suzuki Motors and Toyota Motor Corporation in India. The firms had said they will develop electric and hybrid vehicles for Indian market, in 2017, and then set up a lithium-ion battery manufacturing plant in Gujarat. Besides these, they also have a collaboration for vehicle cross badging, among others.

Each partner will own 50 per cent equity in the entity, which will be named Maruti Suzuki Toyotsu India Pvt Ltd (MSTI), said the companies.

The announcement to set up the plant comes ahead of the scrappage policy, which is expected to come out over the next couple of weeks. While MSTI will source the end of life vehicles from dealers and customers and dismantle them, its processing will include “complete solid and liquid waste management as per the Indian laws and globally approved quality and environment standards,” said the statement issued by MSIL.

Kenichi Ayukawa, MD and CEO, MSIL said, “Through this joint venture, MSTI, we aim to promote recycling and support in resource optimisation and conservation while using environment friendly systems and processes. Scrapping of older vehicles in a scientific and environment friendly manner will help to reduce pollution and also make the roads safer.”

Naoji Saito, CEO (Metal Division), Toyota Tsusho Corporation, said that while his company started ELV recycling in Japan since the 1970s, “we will be able to contribute to Indian society through our knowledge and experience for ELV business. The first vehicle dismantling and recycling unit of MSTI is just the initial step and we are eager to expand to pan-India base with Maruti Suzuki.”

While Mahindra & Mahindra has already set up a motor vehicle recycling company CERO in a JV with MSTC (a government enterprise under the Ministry of Steel), the move from Maruti Suzuki and Toyota Tsusho will further formalise the scrapping and recycling sector.

Scrappage and disposal of vehicles, which have exhausted their useful life, has been a big issue in India. The Ministry of Road Transport and Highways is expected to come out with the draft scrappage policy later this month.