TL;DR
The Indian auto industry missed its FY26 vehicle scrapping targets by 70% due to 'unrealistic policy' and restrictive ELV rules on steel scrap materials.
The Indian automotive industry has fallen significantly short of its End-of-Life Vehicle (ELV) scrapping commitments for FY26, missing the target by 70%. This non-compliance stems from the Environment Protection (End-of-Life Vehicle) Rules, 2025, which came into effect on April 1, 2025. These rules mandate automakers to fulfill extended producer responsibility (EPR) obligations based on the weight of steel recovered from scrapped vehicles.
Industry executives attribute this substantial shortfall to the 'unrealistic policy' framework. A key amendment on March 27, 2026, removed the provision for counting 'other steel scrap materials' towards EPR certificates, strictly limiting it to steel from scrapped vehicles. This change made it even more challenging to meet the FY26 target, which required scrapping 8% of the steel equivalent of vehicles sold in specific past fiscal years, translating to a shortfall of 5.2 lakh vehicles. The industry faces increasing shortfalls in EPR targets in subsequent years, highlighting the urgent need for a policy re-evaluation.
