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Informist, Wednesday, Sept. 30, 2026

 

MUMBAI – Indian automobile companies on Wednesday lauded the Centre for providing a clear roadmap to accelerate adoption of sustainable and clean automotive technologies, hours after the Ministry of Power officially notified the final Corporate Average Fuel Economy norms. The regulations provide "super credits" for sales of battery electric vehicles, hybrids and flex-fuel-compliant vehicles at the fleet level by companies.  

 

This is the third phase of the emission norms, termed the CAFE-III norms. They will take effect on Apr. 1, 2027 and will remain in force until Mar. 31, 2032. "CAF III regulation lays down a structured roadmap with aggressive annual targets for the next 5 years for the auto industry along with a market-based compliance mechanism," Society of Indian Automobile Manufacturers President Shenu Agarwal said. "This will not only ensure reduction of overall fuel consumption from the new passenger vehicle fleet but also provide an opportunity to the industry to work on various technology pathways providing multiple choices to the consumers," he said.

 

The calculation of fleet-level ratings for automobile manufacturers would factor in metrics such as super credits, carbon neutrality factors, and credits for micro-green technologies. "The regulation recognises the contribution of multiple powertrain technologies and fuels, encouraging multi-faceted R&D and innovation," Rahul Bharti, senior executive officer of corporate affairs at Maruti Suzuki India Ltd., said.

 

Automakers also noted the introduction of credit trading, which the Bureau of Energy Efficiency will manage. This system allows automakers that exceed targets to pool 'credits' and those that fall short to accumulate debits. They can then bank, trade, or buy compliance credits to avoid penalties by authorities. "The provisions for credit trading, pooling and flexible compliance mechanisms offer manufacturers greater flexibility while promoting innovation, investment and competitiveness in India's transition towards sustainable mobility," Tarun Garg, managing director and chief executive officer of Hyundai Motor India Ltd., said.

 

Battery electric vehicles continue to get the most "super credits", with India looking to sharply pivot towards pure electric cars over those run on conventional fuel. Tata Motors Passenger Vehicles Ltd. and Mahindra & Mahindra Ltd. are among India's leading electric carmakers by market share. "Importantly, the continued recognition of zero-emission technologies reinforces the critical role of electrification in achieving India's long-term decarbonisation objectives," Shailesh Chandra, the managing director and chief executive officer of Tata Motors PV, said.

 

The norms' focus on giving progressive credits to various powertrains found favour among automakers that have invested heavily in technologies beyond pure electric cars, such as in hybrids. "The CAFE 3 regulation takes due cognisance of the importance of various clean technologies using an objective and scientific-based assessment methodology to arrive at a regulation that is best suited for our national interests," Vikram Gulati, the country head and executive vice president of Toyota Kirloskar Motor, said.

 

"This will enable the country to rapidly reduce its dependence on imported fossil fuels by leveraging the benefits of high levels of energy efficiency provided by Hybrid vehicles and substituting fossil fuels with electricity using BEVs/PHEVs/REEVs (battery electric vehicles/plug-in hybrid vehicles/range extender electric vehicles)," he said.   End

 

Reported by Anand JC

Edited by Saji George Titus

 

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