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Published on: Dec. 30, 2020, 3:02 a.m.
What ails India's historic vehicles policy?
  • Collectors such as Italian Corrado Lopresto is looking to get their cars restored at lower cost countries; Courtesy: Collezione Lopresto

By Gautam Sen

With the automobile industry contributing significantly to many of the leading economies of the world, the governments of these countries have always had, at the very least, a say in the policies of the industry, or have consciously aided them. Even countries like the United States, which has usually followed a laissez-faire attitude to most industries, has jumped in at least twice to bail out the automobile industry; for the first time in the 1980s, post the recession of the early 1980s, and once again, soon after the financial crisis of 2007-2008. 

Similarly, several European governments have interceded whenever the automobile industry has been in trouble, the most recent being the extensive state-aid budgets of the French and German governments this year since Covid-19 forced the shutdown of automobile manufacturing for several months. And then countries like Japan and South Korea have either dictated and coerced industrial policy to aid the auto industry, or like in the case of China, been directly implicated in it.    

In recent years, some of the governments have also taken cognizance of the importance of the industry around that of older vehicles. Not the ten- or 15-years old vehicles, which most governments would not mind crushing, as that could lead to higher consumption of newer, less polluting vehicles, but that of much older vehicles, namely classic and vintage cars, and motorcycles, as these are increasingly seen as patrimony and national industrial heritage, with values going up every year.   

It has been estimated that the values of the 1.5 million historic vehicles (the terms used to include vintage and classic cars manufactured 30 or more years ago), adds up to almost £25 billion (Rs245,000 crore) in the United Kingdom alone. “Historic vehicles represent approximately 3 per cent of the total UK vehicle parc which comprises more than 43 million registered vehicles of all types,” explains David Whale, Chairman of the Federation of British Historic Vehicle Clubs (FBVHC). “Results from the Federation’s 2020 National Historic Vehicle Survey show that the value of the historic vehicle movement to the UK economy is over £7.2 billion, a significant increase from the £5.5 billion reported in the Federation’s 2016 report.” That adds up to Rs70,000 crore of economic activity during 2019, as well as indicating a growth of over 30 percent in three years. 

“This figure includes £946 million of spending by overseas enthusiasts on goods and services supplied by UK firms,” added Whale, as enthusiasts spent over Rs9,200 crore in buying parts from the UK or getting their vehicle restored there. Whale also added: “Over 34,000 people are directly employed in businesses servicing the historic vehicle market and there is a growing demand for apprentices to train specifically on historic vehicles.”

Making good money

The figures are somewhat similar in the three other important European countries of Germany, France, and Italy. And the ‘business’ of historic vehicles in the United States is estimated as twice as much as these four countries combined, with some 25 million of them in circulation! To keep these 25 million vehicles running, hundreds of small-scale sector companies in Sri Lanka, Thailand and Taiwan supply parts and components, with one company in Taiwan even stamping out brand new body panels of the 1960s Ford Mustang (with toolings supplied by Ford themselves). Then there are these roaring businesses of restoration shops, which make good money restoring and overhauling older vehicles in Mexico (to satisfy American collectors), as well as Slovenia, Poland, and Morocco for European enthusiasts.

Thanks to the prevailing rules in India, we are missing out on all the action and the moolah, despite a distinctive history of historic vehicles and very impressive skillsets available in India. So far, the government has tended to treat historic vehicles as a plaything for the rich but given that a few wealthy collectors had the reputation of indulging in this unusual ‘hobby’, this is not surprising. In the last few years, though, that has been changing. 

The rule for many years was simple: it was not possible to import any cars, unless they were less than six years old and the owner was an expatriate returning home to India. Plus, cars made before 1960 could not be exported out of India either. This was the only rule specific to historic vehicles, which came into effect in 1972, after several collectors convinced the then Prime Minister Indira Gandhi that pre-1960 cars should be considered as national treasures (like art, sculpture, and artefacts).    

There has otherwise been a blanket ban on the import of second-hand vehicles, as the government (and industry) believes that if second-hand vehicles are imported, it would hurt the automobile industry. Historically, there is some truth in that, as in countries like New Zealand, a budding automobile industry was wiped out once they allowed the import of second-hand vehicles, most of which were barely five-year-old reconditioned automobiles from Japan. Obviously, vehicles which are more than 30 years old (as defined by Fédération Internationale des VéhiculesAnciens, or FIVA, for a historic vehicle) should not have same effect as five-year-old almost-new cars.  

A win-win situation

In 2014, after much lobbying, the Indian government allowed the import of vehicles made before 1950. Since then, a few hundred pre-1950 historic vehicles have come in, despite a mindboggling 251 percent duty on the landed cost. Most of them have been picked up relatively cheap in the US, as the majority of these cars have been in rather poor condition. Once imported, they have ended up at restoration shops in various corners of India where considerable efforts have gone into restoring them, by refabricating the metal parts, redoing the upholstery, overhauling the mechanicals, and repainting the car after corrosion treatment, all entailing hundreds of highly skilled manhours. 

Thus, what the ‘opening up’ of the import of historic vehicles from before 1950 has done, is to encourage a burgeoning ‘industry’ of restoration shops across India, as hundreds of mostly unrestored cars have been imported, restored, and then sold on to collectors, all the while adding value by significant sums, whilst bringing in money into the government’s coffers. A win-win situation for everyone.   

Most countries in Europe allow the free import of vehicles which are more than 30years old (in the US the cut-off is 25 years). Following the same logic, it would make a lot more sense if the Indian government too, decided on a 30-year cut-off for historic vehicles, thereby encouraging an even bigger industry of automotive restorations, as the vehicle parc of cars which are pre-1950 is not even a tenth of the parc between 1950 and 1990.

In fact, the government ought to go one step further: allow and encourage the restoration of automobiles belonging to international collectors,thereby providing the foundation to an industry which has huge potential. Instead of Slovenia, Poland and Morocco, India should be the preferred place for the restoration of historic vehicles. 

At the same time, it is important to keep the historic vehicle fleet in India ‘alive’. On 25November last, the Ministry of Road Transport and Highways (MoRTH) issued a notification which privileges the occasional use of what they described as ‘vintage’ vehicles. As per the MoRTH notification, the definition of a vintage vehicle is one which is more than 50 years of age (the correct usage of the word vintage though refers to vehicles made between 1918 and 1930). Thus, this new set of regulations, if passed, will address less than 10,000 vehicles, as not many more than those numbers survive from 50 years ago; whereas the number of vehicles which are more than 30 years old are estimated at around 100,000.

These new rules, thus, may well condemn 90,000 vehicles (valued at Rs15,000 crores!) to possible destruction, decimating the patrimony of the nation. Most importantly, this 100,000-odd do not even account for 0.03 percent of India’s current vehicle parc of 32 crore cars, two-wheelers, and commercial vehicles! 

Given that historic vehicles cover very few kilometres annually (in the UK they are estimated to do less than 1,200 miles per year) the main purpose of controlling emissions by banning the use of such occasional use vehicles ismeaningless. That was the starting point of this notification as the National Green Tribunal banned the use of petrol vehicles over 15 years of age (and diesels that are ten-plus) in the Delhi and NCR region since 2014, thereby ending the possibility of taking out a historic vehicle in the capital over the weekend.   

Historic vehicle events

Delhi, like several cities in China and over 200 in Europe, has become a Low Emission Zone (LEZ), and many more cities in India are expected to become so, as six of the ten most polluted cities in the world are in India. Most LEZs in Europe have a special provision that allows the use of a historic vehicle over the weekend – the best way to keep an old machine healthy is to take them for an occasional drive.

Beyond patrimony, tourism is another argument. Across the globe there are innumerable historic vehicle events which bring millions into the coffer of local authorities, hotels, shops, and businesses. For instance, the Mille Miglia retrospective rally, held usually during May every year across Italy, “attracts 1,200 hundredparticipants in 600 cars, and millions of spectators (between four and five million) over a thousand miles of the Italian countryside, generating business worth millions every year for the locals of Brescia, where the event starts and ends,” explains Dr Francesca Parolin, Director General of 1000 Miglia srl, "It is in many ways a rolling museum for some of the most fascinating of automobiles from our industrial history."

Over four days more people get to see this mobile heritage than visit museums in Italy, and more than half are tourists from abroad. There are hundreds of similar events elsewhere. Which is why authorities, are getting stricter regarding pollution control by creating more LEZs yet protecting and preserving the historic vehicle movement. 

It would be useful to learn from the rest of the world, and rethink the short-sighted notification, which can only be detrimental to the movement. Whilst more and more nations recognise the world of historic vehicles as heritage, the wealth of a nation, as well as an industry, which deserves to be encouraged, India will be taking retrograde steps, which will only go against the country’s patrimony.

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