In an effort to mitigate air pollution in the capital, several organizations have mobilized resources to launch a renovation scheme directed at renewing Tehran’s taxi van fleet.
There are more than 7,000 taxi vans on the verge of falling apart in the capital, according to the director of Tehran Taxi Organization Alireza Qanadan.
The government’s taxi van renovation scheme began in late February with the aim of revamping the metropolis’ fleet, reported Students News Network.
The scheme follows the same outlines as another program dubbed “Nosazi”—which means renovation in Persian—introduced by the government in 2016 in collaboration with local banks and carmakers to send old cabs to the junkyard in exchange for a new vehicle.
The scheme, now targeting dilapidated vans, grants long-term in expensive loans to taxi drivers to give impetus to a process to salvage public transportation fleet and curb the suffocating air pollution Tehran is grappling with.
In Tehran, outdated vehicles spew poison into the air and are said to be responsible for a staggering 80% of the pollution. Taxis, which hardly account for 2% of the public transport fleet, generously contribute 18% to the toxic air.
Extensive Incentives
Loans offered by the Tehran Municipality, carmakers and a grant given out by Iran’s Transportation and Fuel Management Headquarters, and proceeds from the sale of the old vehicle itself are all factors contributing to the scheme to revamp the fleet.
As specified by Qanadan, the cost of a single taxi van is 1.23 billion rials ($29,285).
Iran’s Transportation and Fuel Management Headquarters, which is affiliated to the Presidential Office, provides car owners with a 160-million-rial ($3,809) grant, roughly 13% of the cost.
The Tehran Municipality pitches in by providing a 200-million-rial ($4,761) loan, amounting to 16% of the total amount required.
Carmakers are to make a 600-million-rial ($14,285) loan, which covers 48% of the expenses.
The clunker can be sold for 120 million rials ($2,857), which means the owner of the van must make an initial payment of 150 million rials ($3,571) or 12% of the costs to replace their car and make the rest of the payments according to an installment plan.
Fleet of Clunkers
The number of taxi vans in Tehran stands at over 7,000 units, a significant number, although according to Qanadan not all these vehicles are currently active.
He says no van has joined the fleet in the past ten years, adding that “current taxi vans are gradually becoming rusty. Vans manufactured in 2007 are now considered clunkers and must be replaced.”
“There are 6,874 vans manufactured in 2007 and 2008 now considered dilapidated. If we had refrained from giving subsidies to taxi owners, the renovation scheme would have been unaffordable and drivers would not have been willing to replace their vehicles.”
Qanadan pointed to the 220 vans which are currently being renewed and said that although the Tehran Taxi Organization was in a tight spot financially, they prioritized the renovation scheme.
As stated by him, lack of government incentives can put an end to the renovation process.
One Stone, Two Birds
The authorities are aiming to kill two birds with one stone with the scheme; on the one hand, the plan aims is to ease the air pollution which has plagued the capital for years, and on the other, it is to boost the auto industry.
The scheme is poised to encourage local automakers to increase their production rate. During the past Iranian year which ended in March, 964 vans were produced in the country, indicating a 444.6% year-on-year growth. Vans had a 0.06% share of Iran automakers total output during the period.
Furthermore, aside from reining in air pollution, government incentives might help save scrappage centers from bankruptcy as they are grasping at straws to keep the business afloat.
Roughly nine out of ten scrappage centers have been forced to shutter their business over the past year due to muddled government policies such as exempting local automotive companies from sending one old car to the junkyard if they produced vehicles with fuel consumptions over 8.5 liters per 100 kilometers.
Similar programs have been carried out by countries such as the United States, Germany and Thailand.
