Automakers tell NITI they cannot trace old vehicles under ELV rules regime

Industry seeks access to updated vehicle-registration records, saying poor traceability and documentation issues could hamper compliance with end-of-life vehicle recycling norms

Automobile manufacturers told NITI Aayog on Tuesday that they often have no idea where many 20-25-year-old vehicles are because ownership changes multiple times over their lifecycle. They sought government support — including access to updated Vahan registration records — to trace such vehicles, Business Standard has learnt.

 

During a meeting organised by NITI Aayog, auto industry executives said the lack of traceability of old vehicles could make it difficult to meet obligations under the Centre's recycling rules for end-of-life vehicles (ELVs), which were issued last year.

 

During the meeting, executives of certain automakers alleged that Automated Testing Stations (ATSs) are not effectively identifying ELVs. They also said pending traffic challans and other liabilities discourage owners from taking old vehicles to authorised scrapping centres, according to sources.

 

Under the Environment (Protection) (End-of-Life Vehicles) Rules, 2025, which came into force on April 1, 2025, vehicle manufacturers have been assigned annual Extended Producer Responsibility (EPR) targets for scrapping end-of-life vehicles. For 2025-26, manufacturers must obtain EPR certificates equivalent to at least 8 per cent of the steel used in private vehicles sold in 2005-06 and commercial vehicles sold in 2010-11. The target will rise to 13 per cent from 2030-31 and 18 per cent from 2035-36.

 

A senior executive of a major passenger vehicle maker, during the meeting, said manufacturers have virtually no visibility on the whereabouts of many 20-25-year-old vehicles.

 

"OEMs have no idea about the whereabouts of these vehicles... By the time they reach 25 years, ownership changes three, four, five times, maybe multiple times. And these old vehicles never come to OEM workshops. So we do not have any idea where these vehicles are," the executive stated at the meeting, according to sources.

 

"We just keep waiting for vehicles to come and then send them to an RVSF (registered vehicle scrapping facility). And that never happens because these vehicles are very old," the executive added.

 

To address the issue, the executive suggested that manufacturers be given access to updated ownership information available in the Vahan database maintained by transport authorities so they can contact current owners and encourage them to scrap their vehicles through authorised facilities.

 

The traceability issue surfaced repeatedly during the discussion. An executive from a commercial vehicle manufacturer said more dynamic updating of active vehicle records in the Vahan database was necessary for accurate estimation of ELVs.

 

Executives from the recycling industry proposed linking vehicle registration numbers with Goods and Services Tax (GST) invoices generated when recovered materials such as steel, aluminium and copper are sold, creating a digital trail from scrappage to material recovery.

 

A senior executive of a vehicle-scrappage marketplace operator said documentation and ownership issues were pushing a large number of vehicles towards informal scrapping channels. "Someone has a car but the legal owner sold the car many years ago, but they did not go to the RTO to transfer that car's ownership," he noted, adding that such cases were extremely common.

 

"Every day almost, we have cars that either have issues with ownership records, or the legal owner is dead, or the legal owner has left India and just gave the car to someone, and many of them sell the car without doing the proper transfer... So many of these cars have to go to the informal sector because they don't have the proper documentation to come to the legal sector," he said.

 

The marketplace executive suggested a "know your car" mechanism, similar to know-your-customer (KYC) norms used by banks, to allow ownership details to be updated when the registered owner has died, left the country, or transferred the vehicle without completing the formal paperwork.

 

NITI Aayog did not immediately respond to Business Standard's queries regarding the matter.

 

Concerns over traceability were accompanied by criticism of Automated Testing Stations, which were introduced under the Vehicle Scrappage Policy to identify unfit vehicles through fitness tests.

 

An executive from a foreign passenger vehicle manufacturer said ATSs were expected to become a key source of ELVs for the formal recycling ecosystem, but that was not happening. "As per our information, almost 95 per cent, more than 95 per cent, of the vehicles that go to ATSs come out as fit vehicles. So, they are not turning into ELVs after going into an ATS," the executive said during the meeting, according to sources.

 

The executive added that ATSs were supposed to be "a very critical strategic lever" for the development of the ELV ecosystem but were being "largely overlooked".

 

ATSs were introduced under the Vehicle Scrappage Policy to identify unfit vehicles through automated checks of fitness, safety and emissions. Transport vehicles such as trucks and buses must undergo fitness certification every two years until they are eight years old and annually thereafter, while private vehicles are tested at the time of registration renewal after 15 years and every five years subsequently. Vehicles that fail these tests are expected to enter the formal scrappage ecosystem through RVSFs.

 

An executive of a commercial vehicle maker said ATS capacity remained limited and that "a lot of vehicles are passing the fitness test where they should probably be much more objective in their assessment".

 

Several participants in the meeting said that unless ATSs start identifying more genuinely unfit vehicles, authorised scrapping centres will continue to struggle for feedstock, or the supply of vehicles available for dismantling and recycling.

 

Automakers and RVSF executives also said that pending traffic challans and other liabilities were discouraging vehicle owners from approaching authorised scrapping centres.

 

A representative of the recycling industry said "pending challans, liabilities, documentation issues" were among the key reasons why ELVs were not reaching RVSFs.

 

Referring to discussions around Delhi's scrappage framework, the participant said authorities should consider removing the burden of older challans.

 

"If you can let go of challans that are older than one year... then we can increase the flow of ELVs to the RVSFs," the executive said.