Automotive parts manufacturers continuously strive to reduce weight, improve strength and thermal resistance and reduce costs for vehicle components. Improvements in manufacturing technologies associated with compression molding and the use of SMC (Sheet Molding Composites) have resulted in the replacement of traditional formed steel components with SMC for increasing larger vehicle components such as hoods, body panels and truck beds. While SMC material replacements have achieved product weight and cost reduction goals, manufacturers are faced with a difficult problem associated with recycling of SMC scrap. Unlike steel, SMC scrap is not readily recyclable at present. Besides SMC scrap, paint sludge is another major scrap for the SMC industry. This paper explores the unique and desirable properties of SMC scrap and automotive industrial paint sludge waste when blended with common thermoplastic scrap in an extrusion operation.