India's automotive sector is navigating a new regulatory landscape following the implementation of the Extended Producer Responsibility (EPR) policy for End-of-Life Vehicles (ELVs), which came into effect on April 1, 2025. This policy mandates Original Equipment Manufacturers (OEMs) to acquire certificates from Registered Vehicle Scrapping Facilities (RVSFs) for recycling a specified percentage of steel from their older vehicles.
While the directive is in force, critical details regarding its execution, including the precise methodology for calculating steel content and liability targets for OEMs, and the transaction processes between OEMs and RVSFs, remain unclear from the Central Pollution Control Board (CPCB).
In response to this ongoing regulatory ambiguity, Tata Motors is employing a two-pronged strategy focused on both external engagement and internal capacity building. PB Balaji, Group Chief Financial Officer of Tata Motors, during a post result conference call on Friday highlighted that the EPR policy is an industry-wide issue and not unique to Tata Motors. He acknowledged the current lack of clarity in terms of how it'll get executed and the challenges involved.
"SIAM is leading the conversations with the authorities to seek clarification and how the modus operandi will get executed and there's a lot of good resonance on that" Balaji noted.
In parallel, Tata Motors is actively establishing registered vehicle scrapping facilities under the Re.Wi.Re brand recycling of materials.The company has already set up 10 such recycling centers and there are plans to establish at least one in every Indian state over the next few years. Balaji expressed confidence in their ability to scale up these initiatives, stating that the unit economics have already been established, and they are working with dealer partners.
Despite the pending clarity on specific costs and methodologies, Balaji affirmed that there is "no stress on that front" concerning their recycling centers. However, he reiterated the necessity for clear guidance on the policy's full implementation.