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Will the Scrap Vehicle Incentive Law affect the scrap market in Türkiye?

The Scrap Vehicle Incentive Law, prepared to rejuvenate the vehicle fleet of 25 years and older in Türkiye, has been submitted to the Parliament. Under the new regulation, vehicles older than 25 years will be scrapped, and their owners will be given the opportunity to purchase a new vehicle with an exemption from the Special Consumption Tax (ÖTV). Well, how will this decision affect the scrap market in Türkiye?

Will the Scrap Vehicle Incentive Law affect the scrap market in Türkiye?

Currently, there are approximately 3 million vehicles aged 25 and older on the roads in Türkiye. Considering that an average passenger vehicle weighing 1,000 kilograms produces around 750 kilograms of metal scrap, if all these vehicles are scrapped, about 2.25 million tons of metal scrap is expected to enter the market. This figure corresponds to about 10% of Türkiye’s total scrap import of 19.99 million tons in 2024.

However, industry representatives and market experts emphasize that it is not possible for all vehicles to be scrapped in the short term. Experts state that only up to 100,000 vehicles could be scrapped in the market, and they argue that this figure is already above expectations. Stating that a maximum of 100,000 vehicles can be scrapped in the market, experts say that even this figure is above expectations. Since scrap vehicle conversion is a time-consuming process, the incentive is not expected to have a major impact on scrap prices and the supply-demand balance in the short term.

Environmental and Economic Benefits Expected
The new regulation will save fuel and reduce environmental pollution. It is also aimed to contribute to the economy and security by reducing the high maintenance and repair costs of old vehicles.

With the scrap vehicle incentive law, it is planned to reduce imports by encouraging domestic automobile production. Once the law comes into force, new vehicle sales are expected to reach the highest levels in Türkiye.

Status of the Proposal in the Parliament and Expectations
The scrap vehicle proposal has not yet been approved in Parliament. However, detailed discussions are expected to begin in the upcoming days. The incentive is expected to come into effect shortly and this process will be a great opportunity for those who want to buy new vehicles.

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