Automakers may seek more time as they weigh response to strict fuel efficiency norms
Carmakers have not aligned on how to respond to the draft proposal, says Siam. The draft has given some relief to small cars, but includes provisions to implement strict fuel efficiency requirements on carmakers
The country’s premier automobile lobby may seek more time to respond to the government's latest proposal to implement strict fuel efficiency norms as carmakers weigh their feedback amid differences within the industry, according to a person directly in the know.
The Bureau of Energy Efficiency (BEE) had asked all stakeholders to respond within 21 days after it released the final draft of the third corporate average fuel efficiency (CAFE 3) norms on 25 September, which are to be implemented from 1 April 2027.
“It is a very complex subject, so it will take more time for the industry to respond," the person quoted above said. The carmakers were expected to give their recommendations by 16 October.
Carmakers have not aligned on how to respond to the draft proposal, according to Siam. The proposal has given some relief to small cars but includes provisions to implement strict fuel efficiency requirements on carmakers.
“We have just received the proposal from BEE based on our submission given in December 2024. We are yet to deliberate and align on this internally," said Siam president Shailesh Chandra, while responding to a query during a press conference on Wednesday. “Till we don’t represent ourselves to the government, we don’t want to talk about the subject."
No update
In response to Mint’s queries on whether the industry body will seek more time to respond to the proposal, Rajesh Menon, Siam director general, said, “We have no further update to share right now. Once we send our representation to the Govt, we will be in a better position to respond to this query."
Siam includes all major passenger vehicle makers as members, including Maruti Suzuki India Ltd, Hyundai Motor India Ltd, Tata Motors Ltd and Mahindra and Mahindra Ltd.
This won’t be the first time the automobile industry has not responded within the suggested period. The agency had released the draft of the norms on 28 July and asked for comments from the industry within 30 days. However, the government did not receive any response from the body.
Mint reported on 18 September that BEE is concerned about not receiving a response from the industry on time, which is delaying the implementation of the fuel efficiency norms.
Divided on small cars
The industry has been divided on the issue of small cars. While Maruti Suzuki had called for relaxations on small cars in earlier deliberations, Tata Motors and Mahindra, among other carmakers, have opposed such a relaxation.
In December, the industry termed BEE’s first draft, released in June last year, “too aggressive," saying it could threaten the auto sector's viability. The industry started discussing the norms again after the government asked how small cars could be granted some relaxations.
BEE, in its final draft, eventually decided to give some benefits to small carmakers. Cars shorter than four metres, weighing less than 909 kg and powered by sub-1200 cc engines, will get an advantage of 3 grams while calculating carbon dioxide (CO2) emissions for CAFE 3 rules.
BEE's draft released on 25 September asks carmakers to gradually cut the average fuel consumption of the cars they sell from 3.73 litres per 100 km in 2027 to 3.01 litres by 2032.
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