My parents both have alzheimer's and the state has just taken away their driver's licenses, but they won't give up their car keys and said they are going to keep driving anyway. They have both gotten lost driving, and they have been declared incompetent as well as they can't handle finances. We are trying to get them into a memory care facility and hope to accomplish this soon (which is another topic, how to get them there), but until we do, we don't know if we should take the keys from them, sneak them away, take the car, or disable the car. They are in denial about having alzheimer's and think they are just fine.
If you have POA and your parents are incompetent to make their own decisions, sell the car. If there are no qualified drivers in the house there is no reason to keep it there. Do whatever you have to do to get the keys. This is not about being nice to parents -- it is about potentially saving the life of some bystander.
My husband grieved the loss of his car and driving about a year. Don't expect this to be easy, but it is necessary.