Author: Aditi Shah
NEW DELHI, Feb 9 (Reuters) – India has scrapped planned concessions for small cars in upcoming fuel efficiency rules, a government document showed, after automakers including Tata Motors and Mahindra & Mahindra argued it would only benefit one company.
A September draft proposed leniency for gasoline cars weighing 909 kilograms (2,004 pounds) or less, an exemption widely seen as a benefit to Maruti Suzuki, which controls 95 percent of India’s small car market.
India’s power ministry has now scrapped that exemption and tightened other parameters, increasing pressure on all automakers to boost sales of electric and hybrid vehicles, according to the latest 41-page draft reviewed by Reuters.
The new rules curb overcompensation for vehicle weight, aim to level the gap between light and heavy fleet manufacturers and aim to achieve real-world efficiency gains, the document said.
They introduced “a pathway to significant and substantial reductions in emissions”, the report added.
The Power Ministry did not respond to a request for comment.
Promote electric and hybrid models
Transportation accounts for about 12% of India’s energy consumption and is a major driver of oil imports and carbon emissions. Passenger cars account for nearly 90% of transport-related emissions, the document said.
Corporate average fuel efficiency standards set the amount of carbon dioxide emissions allowed from a manufacturer’s fleet of passenger cars weighing less than 3,500 kilograms (7,716 pounds). They are updated every five years and push carmakers to adopt cleaner technologies, including electrification, compressed natural gas and flex fuels.
The new rules will apply from April 2027 for five years and are at the heart of the carmaker’s product and powertrain investment plans. It’s unclear when the rules will be finalized.
The September draft will allow fuel consumption targets to accelerate as vehicle weight increases, relaxing compliance for heavy-duty carmakers such as Mahindra, Tata and Volkswagen, while tightening requirements for light-duty fleet makers such as Maruti. This imbalance prompted divestment.
The revised scheme reduces the extent to which heavier vehicles receive looser targets.
“Manufacturers with heavier fleets … will need to achieve stronger intrinsic efficiency improvements,” the document said.
The credit system will reward companies that sell more electric cars and plug-in hybrids and allow fuel consumption performance to be pooled between companies. Violators face fines of up to $550 per vehicle.
The revised plan aims to cut average fleet emissions from 114g/km to around 100g/km over the five years to March 2032. With credits, if electric models account for 11% of total car sales by 2032, this could drop to 76g/km.
(Reporting by Aditi Shah. Editing by Mark Potter)
