In FY26, India's auto industry faced a significant challenge, missing its vehicle scrapping target by 70% under the Environment Protection (End-of-Life Vehicle) Rules, 2025. The rules mandated that automakers scrap 8% of the steel equivalent of vehicles sold in previous years, translating to a target of 7.62 lakh vehicles. However, only 2.42 lakh vehicles were actually scrapped, highlighting the sector's struggle to comply with the new regulations. Industry executives have criticized the policy as unrealistic, particularly after a March 2026 amendment removed the allowance for counting 'other steel scrap materials' towards compliance. This change has made it nearly impossible for manufacturers to meet their Extended Producer Responsibility (EPR) obligations. The Society of Indian Automobile Manufacturers (SIAM) has voiced concerns regarding the limited availability of end-of-life vehicles (ELVs) and the negligible volumes generated by automated testing stations. With the EPR targets set to escalate to 13% and 18% in the coming years, industry leaders are urging a re-evaluation of the policy to facilitate compliance and support the development of a robust scrapping ecosystem.